SMEs,Growth, and Poverty: Cross-Country Evidence |
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Authors: | Thorsten Beck Asli Demirguc-Kunt Ross Levine |
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Institution: | (1) The World Bank, 1818 H Street NW, 20433 Washington, D.C., USA;(2) Department of Economics, Brown University, 64 Waterman Street, Providence RI 02912, The NBER |
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Abstract: | This paper explores the relationship between the relative size of the Small and Medium Enterprise (SME) sector, economic growth, and poverty alleviation using a new database on the share of SME labor in the total manufacturing labor force. Using a sample of 45 countries, we find a strong, positive association between the importance of SMEs and GDP per capita growth. The data do not, however, confidently support the conclusions that SMEs exert a causal impact on growth. Furthermore, we find no evidence that SMEs alleviate poverty or decrease income inequality. |
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Keywords: | Firm size market structure economic development |
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