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| Making business service markets work for the poor in rural areas, DFID/Springfield 2004 |
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| Implementing agency(ies) | Springfield Centre for Business in Development |
| Funding agency(ies) | Department for International Development (DFID) |
| Date completed | June 2004 |
| Geographic setting(s) | Rural |
| Issues/challenges | weak markets, addressing poverty |
| Contact person(s) | Mr. Rob Hitchins |
| Web site | The Springfield Centre for Business in Development |
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Description
Many development fields are concerned with enhancing income generation and livelihood opportunities for the poor and the poor's capacity to respond to these opportunities. The objective of "making markets work for the poor" so they can engage in and benefit from local, national and international markets requires a nuanced understanding of markets. It requires interventions to look at existing market structures and operations and roles of different players within the market, identifying how the existing system inadequately serves the poor and what development interventions can do to improve it.
This paper examines these issues, recognizing the important overlaps among different development fields and the need for better interaction among them. Specifically, it reviews the experience of developing business service markets in weaker economic contexts, particularly rural areas. The paper identifies a number of dimensions of economic weakness that are relevant to service provision and reviews the experience in addressing these dimensions.
Summary of results
Some key findings from the paper on business services in rural areas:
- Business services exist in a wide variety of rural contexts,
- There is often a blurred distinction between business services and other services,
- Basic services are important to SEs in these contexts,
- There is often a high degree of informal, micro-scale services and delivery mechanisms,
- Services tend to be embedded within other transactions and relationships,
- There is a prevalence of subsector related services,
- There are often collective delivery and consumption of services,
- Small urban centers are important as service delivery nodes to rural areas, and
- Some services are delivered through different forms of public-private partnership.
Key recommendations from the paper:
- Recognize that weaker areas present a challenging and complex environment for interventions and that innovation and flexibility are required;
- Understand what kinds of services and delivery mechanisms are relevant for weaker markets - generally simpler, cheaper, less-sophisticated and smaller than in stronger markets;
- Develop a better understanding of the wider economic context for business services;
- Develop appropriate and valid roles for the state; and
- Design and use innovative and flexible intervention structures and approaches.
Also needed are:
- More practical information and analysis for interventions; and
- Realistic and explicit assessment of sustainability from the outset.
Themes
Best Practice, Market Development
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