Difference between revisions of "Mzungu price (Kenya)"

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[[File:Mzungu.jpg|thumb|300px|left|A street market in Kenya. Source: [https://www.flickr.com/photos/heandi/5652474286/in/photolist-9BupFd-d37Q63-aPnYfR-aPnYTH-aPnWH2-aPnVP8-2fU9BD-6Jra6W-g8nNUn-fcjgNm-5dY1uN-9mHhQN-5dTGiP-5dTFA8-d39ycA-4vAp-aR1P5R-M5DLUX-e2ysaH-6VHDyE-2f8ABpd-TXLQni-4rcjfv-8ZnvG9-aR1JqP-2aYfXNC-oQfWDE-UGAaXT-8DixFF-2dPaZky-6kjWYP-2dPaZMA-4PQPZ2-LUtyoH-4XNamn-5Tuj8A-o6NqJV-nMu5KV-dxFbcj-2hkhXP5-azNkSp-4vAN-59yUMQ-MFQZHC-JFDTyv-2aWM2Tm-LUrx4U-24aFZBX-Q3VozH-rBFnUM Christie Sanasi]. [https://creativecommons.org/licenses/by/2.0/ CC by 2.0].]]

[[File:Mzungu.jpg|thumb|300px|left|A street market in Kenya. Source: [https://www.flickr.com/photos/heandi/5652474286/in/photolist-9BupFd-d37Q63-aPnYfR-aPnYTH-aPnWH2-aPnVP8-2fU9BD-6Jra6W-g8nNUn-fcjgNm-5dY1uN-9mHhQN-5dTGiP-5dTFA8-d39ycA-4vAp-aR1P5R-M5DLUX-e2ysaH-6VHDyE-2f8ABpd-TXLQni-4rcjfv-8ZnvG9-aR1JqP-2aYfXNC-oQfWDE-UGAaXT-8DixFF-2dPaZky-6kjWYP-2dPaZMA-4PQPZ2-LUtyoH-4XNamn-5Tuj8A-o6NqJV-nMu5KV-dxFbcj-2hkhXP5-azNkSp-4vAN-59yUMQ-MFQZHC-JFDTyv-2aWM2Tm-LUrx4U-24aFZBX-Q3VozH-rBFnUM Christie Sanasi]. [https://creativecommons.org/licenses/by/2.0/ CC by 2.0].]]

In the absence of market regulation, the informal Kenyan traders base the prices of their ware on what they believe ''mzungu'' are willing to pay rather than on the value of the products. Street traders usually make only minimal profits and do not enjoy social protection. This incentivises them to establish a ''mzungu'' price. One estimation suggested that street traders earned between $1.4 and $14.3 daily profits on average in Nairobi Central Business District in 2007 (Kamunyori 2007). The UN places the poverty line for sub-Saharan Africa at $1.9 per day (United Nations, n.d.). The broad range in daily profits depends on the trader's selling skills – the ability to set the highest viable ''mzungu'' price.  

In the absence of market regulation, the informal Kenyan traders base the prices of their ware on what they believe ''mzungu'' are willing to pay rather than on the value of the products. Street traders usually make only minimal profits and do not enjoy social protection. This incentivises them to establish a ''mzungu'' price. One estimation suggested that street traders earned between $1.4 and $14.3 daily profits on average in Nairobi Central Business District in 2007 (Kamunyori 2007). The UN places the poverty line for sub-Saharan Africa at $1.9 per day (United Nations, n.d.). The broad range in daily profits depends on the trader's selling skills – the ability to set the highest viable ''mzungu'' price.  

The main barrier to effective regulation is lack of enforcement, despite frequent attempts by the local authorities to limit the growth of the informal sector (Pohl 2002). Police actions are rarely effective as compliance from citizens is low. Regulation gets even more complicated with formally licenced traders, who nevertheless retain a small margin of freedom when setting prices, thereby enabling prices to be based on unfair subjective decisions. The Micro and Small Enterprises Act issued by the Kenyan government in 2012 was an attempt to register street traders as micro enterprises. However, the trading licenses were not issued broadly enough. According to estimates, Nairobi had 500,000 street traders, while only 7,000 licenses were issued in 2005 (Lyons and Snoxell 2005). The complex licensing process and the limited number of licenses granted discourage people from registering.

The main barrier to effective regulation is lack of enforcement, despite frequent attempts by the local authorities to limit the growth of the informal sector (Pohl 2002). Police actions are rarely effective as compliance from citizens is low. Regulation gets even more complicated with formally licenced traders, who nevertheless retain a small margin of freedom when setting prices, thereby enabling prices to be based on unfair subjective decisions. The Micro and Small Enterprises Act issued by the Kenyan government in 2012 was an attempt to register street traders as micro enterprises. However, the trading licenses were not issued broadly enough. According to estimates, Nairobi had 500,000 street traders, while only 7,000 licenses were issued in 2005 (Lyons and Snoxell 2005). The complex licensing process and the limited number of licenses granted discourage people from registering.