We know little about how [African] markets operate in practice. Perhaps the best measure of this lack of knowledge is our propensity to call ‘‘informal’’ everything that is not of Western inspiration. The truth is that market activity in Africa is not without form; it is only without economic formalization.
African market arrangements and institutions take many forms, and it would be misleading to lump them together into a single ‘‘informal sector.’’ [...] The problems that indigenous institutions attempt to solve are the usual ones—commitment failure, asymmetric information, and transactions costs—but the solutions often are original. African market realities are nothing but a transformed image of those in advanced countries. Studying markets in Africa forces us to rethink the very nature of markets.