to certain types of businesses (Serra, 2009). As a consequence Cramer et al. (2008, p. 4) claim that “the great mass of female workers in rural areas exercise little real choice in their employment”. Bridges et al. (2013) find that if a family member loses employment, women often have to change their occupational status as a result. Using data from the Tanzanian Household Urban Panel Survey (THUPS) spanning 2004 to 2006, they find that women tend to move in and out of labor (and self-employment in a household enterprise) as a response to labor market shocks, while men more often change the nature of the work they do. This is a major reason why women in Africa have been found to be more likely to engage in the non-farm economy (Canagarajah et al., 2001; Loening et al., 2008; Rijkers and Costa, 2012; Ackah, 2013) or to migrate (Shi et al., 2007) compared to men, and why we expect their enterprises to be less productive.

Finally, scholarly work has recognized the importance of first and second nature geography for development (Krugman, 1998; Venables, 2005). First nature geography, referring to the impact of natural features such as ruggedness and fertility of the terrain, climate, and altitude, will have an impact on agriculture (Reardon, 1997) and hence on rural nonfarm enterprises to the extent of the farm to non-farm linkages that exist. Second nature geography, referring to the location of an enterprise and its distance from markets and other agglomerations, will determine access to demand, scale economies, competition, and spillovers. Fafchamps and Shilpi (2003) find that the share of non-farm wage employment declines the further a household is located from a urban center. Moreover they find that there is a U-shaped relationship between distance from a urban center and the share of income from self-employment. This suggests a possible protection effect of deep rural isolation on non-farm enterprises, perhaps most pertinently for enterprises dealing in tradable goods. Generally distance, but also other determinants of market access such as the quality of roads and utilities, can be important determinants of development in both the farm and non-farm economy of Africa and of the linkages between the two. For the specific impact of geographic dimensions, more empirical evidence is however needed (Wiggens, 2000; Roepstorff and Wiggens, 2011; Zezza et al., 2011).

# **2.2 Productivity**

Syverson (2011) provides a comprehensive literature review on enterprise productivity. This literature is largely concerned with enterprise performance in developed economies, where the most important determinants of enterprise productivity are identified as education, experience, and market structure (Moretti, 2004; van Biesebroeck, 2005; Bloom and Reenen, 2010). The literature also finds that female-headed enterprises are less productive than male-headed enterprises (Amin, 2011; Kinda et al., 2011; Saliola and Seker, 2011; Rijkers and Costa, 2012). Furthermore enterprises clustered together are more productive, because of localization and urbanization economies due to knowledge and technology spill-overs (Martin et al., 2011; Bloom et al., 2013), horizontal linkages (Nichter and Goldmark, 2009) and more competition (Foster et al., 2008; Ali and Peerlings, 2011). It thus stands to reason that the geographical location of an enterprise, and in particular its proximity to other productive enterprises affects its productivity.

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