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Finance and Demand for Skill : Evidence from Uganda

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  • Beck, T.H.L.

    (Tilburg University, School of Economics and Management)

  • Homanen, M.
  • Uras, Burak

    (Tilburg University, School of Economics and Management)

Abstract

We explore the empirical interaction between firm growth, financing constraints, and job creation. Using a novel small-business survey from Uganda, we find that the extent to which small businesses expand skilled employment as their sales and profits increase is significantly related to access to external funding, while the hiring of casual and family workers is not. The results are robust to the inclusion of various firm level controls, region and sector fixed effects. We support our findings by providing empirical evidence on the relationship between planned hiring and firms’ access to finance.
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Suggested Citation

  • Beck, T.H.L. & Homanen, M. & Uras, Burak, 2016. "Finance and Demand for Skill : Evidence from Uganda," Other publications TiSEM a1495b1c-7310-460d-a173-c, Tilburg University, School of Economics and Management.
    • Handle: RePEc:tiu:tiutis:a1495b1c-7310-460d-a173-ce4b3e5578df
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    File URL: https://pure.uvt.nl/ws/portalfiles/portal/11039722/Labor_and_Finance_in_Uganda_April_5_2016_MH.pdf
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    References listed on IDEAS

    as
    1. Popov, Alexander, 2014. "Credit constraints and investment in human capital: Training evidence from transition economies," Journal of Financial Intermediation, Elsevier, vol. 23(1), pages 76-100.
    2. Abhijit V. Banerjee & Esther Duflo, 2014. "Do Firms Want to Borrow More? Testing Credit Constraints Using a Directed Lending Program," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 81(2), pages 572-607.
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    Cited by:

    1. Kersten, Renate & Harms, Job & Liket, Kellie & Maas, Karen, 2017. "Small Firms, large Impact? A systematic review of the SME Finance Literature," World Development, Elsevier, vol. 97(C), pages 330-348.
    2. Thang Bach & Charles Harvie & Thanh Le, 2021. "How credit constraints affect small and medium enterprises' strategic employment decisions and employees' labour outcomes: Evidence from Vietnam1," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 29(2), pages 319-341, April.

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    More about this item

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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