Information frictions and firms’ trading decisions: Evidence from the African Continental Free Trade Agreement (AfCFTA)
This study examines a barrier to international trade and firm growth.
Abstract
This study examines an underappreciated barrier to international trade and firm growth: firms’ lack of information about trade costs and relevant trade agreements. It focuses on the African Continental Free Trade Agreement (AfCFTA) as a case study. The analysis draws on survey data collected in 3 phases:
- 2021 pilot (646 firms, 173 internationally active)
- 2024 baseline (402 internationally trading firms)
- 2025 endline (388 firms, 61% of whom also participated at baseline)
Using baseline survey data and Kenya Revenue Authority (KRA) records, the authors implemented an information intervention. Internationally active firms were randomly assigned to treatment and control groups, and a training session on AfCFTA was delivered in November 2024 to twenty Nairobi based firms in the treatment group.
This paper is part of the Private Enterprise Development in Low Income Countries (PEDL) programme.
Citation
Olapade Y and others. ‘Information frictions and firms’ trading decisions: Evidence from the African Continental Free Trade Agreement (AfCFTA)’ PEDL: Working Paper, GRP, 2026