IDEAS home Printed from https://ideas.repec.org/p/fau/wpaper/wp2016_09.html
   My bibliography  Save this paper

What are the biggest obstacles to growth of SMEs in developing countries? - A picture emerging from an enterprise survey

Author

Listed:
  • Flora Wang

    (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic)

Abstract

SMEs are drivers of economic growth and job creation in developing countries. It is paramount to determine the factors that hinder their growth. This paper uses the Enterprise Survey from the World Bank which covers data from 119 developing countries to investigate the biggest obstacles SMEs are confronting and the determinants that influence the obstacles as perceived by enterprise managers. The results show that SMEs perceive access to finance as the most significant obstacle which hinders their growth. The key determinants among firms’ characteristics are size, age and growth rate of firms as well as the ownership of the firm. The latter – the role of the state in financing SME - is particularly intriguing. External reasons for the financing dilemma are also examined. It is shown that the main barriers to external financing are high costs of borrowing and a lack of consultant support.

Suggested Citation

  • Flora Wang, 2016. "What are the biggest obstacles to growth of SMEs in developing countries? - A picture emerging from an enterprise survey," Working Papers IES 2016/09, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised May 2016.
    • Handle: RePEc:fau:wpaper:wp2016_09
    as

    Download full text from publisher

    File URL: http://ies.fsv.cuni.cz/sci/publication/show/id/5461/lang/cs
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    SMEs; Obstacles to Growth; Financing Dilemma; Developing Countries; firm characteristics; internal and external barriers;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fau:wpaper:wp2016_09. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Natalie Svarcova (email available below). General contact details of provider: https://edirc.repec.org/data/icunicz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.