Implications of informal economic groups’ responses to formal regulation: a case study of street food vendors in the Kumasi metropolis.

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Unaddressed food needs resulting from urbanisation, work pressures and increasing cost of time has fostered an unchecked growth of private informal food retail referred to as street food vending. To protect diverging interests of consumers and investors, formal regulation of SFT has emerged paramount. Unconstructive and burdensome regulations, however, is a disincentive to the growth of these enterprises. This study measures compliance burden, determinants of extent of compliance to regulations and preference for varying regulatory aspects and regimes. Within urban Kumasi, 309 SFVs were sampled across 8 sub-metros for data collection using a structured questionnaire and observations. Data was analysed using descriptive statistics, income statement and regression analysis. Compliance to regulations is found below average among SFVs in urban Kumasi and does not necessarily follow awareness. Most aspects of SFT regulation were negatively perceived. Whereas time cost of compliance is significantly higher non-compliance, money cost of the latter is higher but with smaller difference. Compliance cost is significantly high among users of prohibited sites, improved equipment and undeveloped vending structures. Same is the case among smaller and less viable enterprises subjected to lesser advisory and more regulatory visits as well as punitive enforcement methods. Distance to regulator, cost of compliance, perception of training programmes and daily length of trade activity have major influences on extent of compliance to food safety regulations. Whereas financially viable enterprises favour a massive overhaul of current regulatory regime, members of vendor associations support subtle changes in some/all aspects of SFT regulation. SFVs prefer improved siting regulations the most and improved medical certification the least. Regulatory compliance among SFVs can be made more preferred and less costly by among other things using siting regulations as major entry point while formally working with vendor associations and identifiable third parties to improve perceptions of regulations.
A thesis submitted to the Department of Agricultural Economics, Agribusiness and Extension, KNUST, in partial fulfilment of the requirements for the degree of Master of Philosophy in Agricultural Economics Faculty of Agriculture College of Agriculture and Natural Resources, 2015