African Affairs Advance Access originally published online on February 21, 2006
African Affairs 2006 105(420):353-373; doi:10.1093/afraf/adi106
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Nigerien second-hand car traders in Cotonou: A sociocultural analysis of economic decision-making
J. Joost Beuving is a research fellow at the University of Amsterdam (ASSR) in The Netherlands.
This article discusses the economic decision-making of migrant traders from Niger who operate in large second-hand car markets found in Cotonou (Benin). Like the Cotonou car-trading community at large, these traders continued to import cars despite the fact that local demand dropped in 2002. Case analysis uncovers that Nigerien car traders show a propensity to live up to the expectations of people in authority. Business decisions in geographically separated markets tend not to be based on reliable exchange of information about the conditions of supply and demand. This cultural element that is associated with ethnicity and kinship, in turn, leads to a belief of profitability in the car business that is no longer grounded in observable facts and hence leads to financial losses.
This article draws from an ongoing research project, funded by The Netherlands Foundation for the Advancement of Tropical Research (WOTRO). An earlier version of this article was presented at the biennial conference of the African Studies Association of the UK in London (2004).
1. ‘Nigerien’ is the English adjective referring to the West African country Niger.
2. A. Cohen, Custom and Politics in Urban Africa: A study of Hausa migrants in Yoruba towns (Routledge and Kegan Paul, London, 1969), p. 17. See, for similar observations, J.S. Eades, Strangers and Traders: Yoruba migrants and the state in northern Ghana (Edinburgh University Press, London, 1993); P. Quarles van Ufford and F. Zaal, ‘The transfer of trust: ethnicities as economic institutions in the livestock trade in West and East Africa’, Africa 74, 2 (2004), pp. 121–45; and M. Diouf, ‘The Senegalese murid trade diaspora and the making of a vernacular cosmopolitanism’, Public Culture 12, 3 (2000), pp. 679–702.
3. P. Curtin, Cross-cultural Trade in World History (Cambridge University Press, UK, 1984), p. 3. Well-known contemporary examples of trade diasporas include Indian handicraft traders of Ecuador, see D. Kyle, ‘The Otavalo trade diaspora: social capital and transnational entrepreneurship’, Ethnic and Racial Studies 22, (1999), pp. 422–46, and Lebanese merchants, see M. Rais, The Lebanese of West Africa: An example of a trading diaspora (Das Arabische Buch, Berlin, 1988).
4. A.G. Hopkins, ‘African entrepreneurship: an essay on the relevance of history to development economics’, Genève-Afrique 26, (1988), p. 23.
5. S. Berry, Fathers Work for Their Sons: Accumulation, mobility and class formation in an extended Yorúbá community (University of California Press, Berkeley, 1983), p. 155.
6. See for instance J. Roitman, ‘Unsanctioned wealth; or, the productivity of debt in northern Cameroon’, Public Culture 15, 2 (2003), pp. 211–37 for a discussion on how the prestige of family heads in northern Cameroon regulates their access to cash through advances; see T. Forrest, The Advance of African Capital: The growth of Nigerian private enterprise (Edinburgh University Press, UK, 1994) for a demonstration of how the reluctance of the founder of a business to delegate authority to sons or distant kin reduces the possibility of commercial expansion or diversification.
7. J.O. Igué, Le Bénin et la mondialisation de l’économie: les limites de l’intégrisme du marché (Karthala, Paris, 1999).
8. See P. David, ‘De l’indépendence à nos jours’, in P. David (ed.), Le Bénin. Méridiens. Peuples et pays du monde (Karthala, Paris, 1998).
9. These figures are documented in the following publications: I. Bio-Sawe, Le Port de Cotonou d’hier á aujourd ‘Hui (Port de Cotonou, Cotonou, 1995); F. Lejeal, ‘Spécial Bénin’, Marchés Tropicaux (2002), pp. 2311–14; C. Perret, Le Commerce des véhicules d’occasion au Bénin: problématique régionale et impacts nationaux (LARES, Cotonou, 2002).
10. The disappearance of French cars from West African car markets has been noticed by several periodicals, such as Jeune Afrique, The Courier, and West Africa. Cars originating from the US started to surface in Benin’s official trade statistics from the late 1990s onwards; see Institut National de la Statistique et de l’Analyse Economique, Statistiques de commerce extérieur 1991–2000: produits-pays (République du Bénin, Cotonou, 2001). My survey conducted among 20 Cotonou car traders suggests that during the period 2000–2003 about ten thousand American cars were imported into Cotonou. This figure underrepresents their economic contribution to the trade, as they are usually higher-priced cars (ranging between 
2,000 and 3,000 each).
11. During the 1990s, the number of cars thus confiscated by customs officers never exceeded a few hundred per year (personal comment, H. Sagbo, customs inspector). This figure increased, however, first to 1,104 in 2000, then reached 2,026 in 2001 and amounted to 3,575 units in 2002; see the Département des statistiques de la direction centrale des droits directs et indirects de la douane.
12. My data suggest that average prices decreased by 2–7% for the majority of second-hand cars sold in Cotonou between 2000 and 2002. These figures are ‘real’ selling prices: Cotonou is a so-called free port, meaning that trade is permitted before customs declaration; shipping costs are usually settled after the sale following a ‘freight payable at destination’ system, which includes an insurance for loss and damage.
13. A well-known Beninese expression, summarizing this view, runs: ‘If Nigeria coughs, Benin falls ill’.
14. Representatives of Cotonou’s trading community mainly voiced these objections, including the newspaper supporting their views, Bénin Éspoir (BE). Their stance is brought out by the following comment: ‘The freight from Europe to Togo and from Europe to Bénin is comparable, but transit costs in Togo are lower. That’s why we’re losing out nowadays’ (Mr. M. Badarou, cited in BE, 4 November 2002).
15. Although throughout the fieldwork rumours persisted that car buyers had shifted their activities to car markets in Lomé, my repeated visits to Cotonou’s neighbouring market could not confirm this. This opinion, stressing the lack of market space, was particularly voiced by leading figures in the traders’ syndicates. By propagating the construction of new markets, they seem to have been paying lip service to the car market owners — well-established, wealthy businessmen.
16. This figure is drawn from analysis of the sales receipts. The absence of well-established ties between buyers and sellers seems also to result from the proliferation of specialized intermediaries — so called démarcheurs. They put businessmen visiting Cotonou in contact with car-sellers and, by deploying different forms of impression management, seek to enhance the distance between market parties.
17. For instance, neither individual traders nor branch organizations have as yet launched advertisement campaigns for second-hand cars in Cotonou. A notable exception was the distribution of the magazine Afrique Auto Moto in 2003, which soon failed owing to disappointing sales.
18. J.J. Beuving, ‘Cotonou’s Klondike: African traders and second-hand car markets in Bénin’, Journal of Modern African Studies 42, (2004) pp. 511–37.
19. See J.C. Mitchell, ‘Networks, norms and institutions’, in J. Boissevain and J.C. Mitchell (eds), Network Analysis Studies in Human Interaction (Mouton, Paris, 1973), pp. 15–35; N. Long, ‘Multiple enterprises in the Central Highlands of Peru’, in S. Greenfield, A. Strickon and R. Aubey (eds), Entrepreneurs in Cultural Context (University of New Mexico Press, Albuquerque, 1979), pp. 123–58.
20. G. Gereffi and M. Korzeniewicz, Commodity Chains and Global Capitalism (Praeger, Westport, CT, 1994), p. 4; see also H. Schmitz and P. Knorringa, ‘Learning from global buyers’, Journal of Development Studies 37, (2000), pp. 177–205.
21. T. Hopkins and I. Wallerstein, ‘Conclusions about commodity chains’, in Korzeniewicz and Gereffi (eds), Commodity Chains and Global Capitalism, pp. 48–51.
22. R.M. Cyert and J.G. March, A Behavioral Theory of the Firm (Prentice-Hall, Englewood Cliffs, 1963), p. 27.
23. J.G. March and H. A. Simon, Organizations (Blackwell, Cambridge, MA, 1994).
24. H.A. Simon, Administrative Behaviour: A study of decision-making processes in administrative organization (The Free Press, New York, 1993), p. xxix.
25. See J. Kornai, ‘The problem of information’, in The Socialist System: The political economy of communism (Clarendon Press, Oxford, 1992), pp. 127–30.
26. It is important to stress the collective nature of this detrimental outcome, because, as Sen pointed out, the objective of economic decision-making needs not be strictly egocentric: ‘choice may reflect a compromise among a variety of considerations, of which individual self-interest may be just one’; see A.K. Sen, ‘Rational fools: a critique of the behavioural foundations of economic theory’, Philosophy and Public Affairs 6, 4(1967), pp. 317–44.
27. My analysis builds in that regard on current critiques on behavioural theories of the firm, such as voiced by T. Felin and N.J. Foss, ‘Organizational routines: A sceptical look’, in M. Becker (ed.), Handbook of Organizational Routines (Edward Elgar, Cheltenham, forthcoming), or D. Dequench, ‘Uncertainty and economic sociology. A preliminary discussion’, American Journal of Economics and Sociology 62, 3 (2003), pp. 509–32.
28. J.M. Keynes, The General Theory of Employment, Interest and Money (Macmillan/Cambridge University Press, UK, 1936), p. 145.