Determinations of Firm Growth: A Study of Rural SMEs in Bosnia-Herzegovina (original) (raw)
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Determinants of Firm Growth: A Study of Rural SMEs in Bosnia-Herzegovina
. The main drivers of rural development can be small sized companies run by rural entrepreneurs, and intervention should be focused on enabling environment for their growth. The paper presents analysis of the factors determining growth in employment by small rural businesses in BiH, using quantitative data from original survey conducted in 2012. The direction and magnitude of different factors were further analyzed through qualitative data analysis. Findings from this research identify the key obstacles affecting growth of rural businesses, primarily related to infrastructure, access to finance, access to market, and availability of ''soft'' skills. The paper proposed possible ways of intervention in reducing these obstacles in order to promote rural development in BiH.
Business development and the growth of rural SMEs
OECD regional development working papers, 2019
The paper reviews the role of Small and Medium Size Enterprises (SMEs) as drivers of employment and economic growth in rural regions across a number of OECD geographies. It argues that SME creation is especially important for rural economic development and identified lessons for national level policy that can help strengthen the performance of SMEs and enhance the creation of new SMEs. This working paper focuses on four cases studies in Atlantic Canada, Quebec, Scotland and the United States to derive general findings and recommendations
The purpose of this paper is to discover and understand factors that lead to small and medium-sized enterprises (SMEs) shutdown in transitional economies, such as the economy of Bosnia and Herzegovina (B&H). The paper provides some findings about main influencing factors that lead to SMEs shut down in the first years of operation from entrepreneurs' and managers' perspective and suggests certain measures that should be taken to secure their survival, development and growth. For the purpose of this paper, empirical research was conducted, using stratified sampling of 110 SMEs from Republic of Srpska (49% of B&H territory). The section on methodology explains the entry criteria for the study population and methods of data analysis. Respondents from the research sample identified the following factors as the main obstacles to successful development of their businesses: difficulties in the collection of receivables from debtors, complicated legal procedures that regulate the work and business operations of enterprises, high rates of taxes and contributions on wages, the negative impact of the global economic crisis and expensive and complicated procedures for obtaining loans from commercial banks. Respondents didn't evaluate their personal traits, level of formal and informal knowledge from business management field or lack of entrepreneurial spirit and readiness for being proactive, innovative or risk acceptance as potential causes of business failure. With its limitation, the paper contains novel information and insights about SMEs business obstacles and: Challenges of small and medium sized companies at early … 46 challenges in economy of Bosnia and Herzegovina as a solid base for more comprehensive future researches.
The Barriers and Opportunities to the Development of Small Business in Rural Areas
Management Theory and Studies for Rural Business and Infrastructure Development
The study presenting and analysing the barriers and opportunities for small business development in rural areas of Poland and Lithuania. The scientific problem-how to develop small business in rural areas and what kind of support measures would benefit business developers. Symmetric research in the form of a survey was conducted among 50 researchers-economists from the University of Agriculture in Krakow and in Agricultural Academy of Vytautas Magnus University in Kaunas. The research is of a pilot nature and constitute grounds for continuing research into the research issues undertaken.The aim of the study was to identify, evaluate and compare barriers and opportunities for small business development in rural areas of Lithuania and Poland and to propose effective incentives for such kinds of businesses. The main barriers to the development of enterprises in Poland include high pension contributions and a complicated VAT paying system. In Lithuania it was indicated poor economic conditions in rural areas and related unemployment and poverty of some of their inhabitants. In Poland, huge opportunities for the development of entrepreneurship were perceived in the opening-up of eastern markets and support from the European Union's funds. In Lithuania-in professional consulting and the use of aid from the EU.
The Role of Small and Medium-Sized Enterprises in the Development of Rural Areas
Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 2017
Apart from the indisputable importance of SMEs to the national economy, they also provide social and economic benefits for regions they operate in. In this context, the rural areas seem to be interesting because currently there can be seen a reappraisal and emphasizing of their importance. Between 2015 and 2016 there were carried out surveys in two different regions (Hodonín and Holešov) in order to define the role of SMEs in rural areas. The aim of these surveys was to determine how the particular players of the regional development subjectively perceive the role of SMEs in rural areas, particularly how is the role subjectively perceived by SMEs themselves and also by local representatives in the given regions and how SMEs perceive doing business in such regions. The analysis of survey results together with the analysis of secondary data on the important characteristics of these two regions provided the basis for comparison of subjective perception of SMEs; economic and social benefits in these two different regions. According to our findings the role of SMEs in rural areas in the Czech Republic is determined by the creation of competitive environment, the deepening of ties between apprentices and practice, the use of local resources, the increase in rural area attractiveness, the financial benefits for municipalities, the creation of vacancies, the sustaining of positive relationships within the local community and the development of infrastructure.
The Role of the Government in Entrepreneurship Development: Evidence from Bosnia and Herzegovina
2016
In recent decades, economic growth in countries around the world has become increasingly dependent on the dynamism of small and medium sized enterprises (SMEs). This is especially important in the transition economies. The creation of a new SME sector in Bosnia and Herzegovina (BiH) as a transition country may play an important role in the process of economic regeneration and job creation. The paper sets out an approach to analyzing the development of SMEs in BiH. We have focused on (i) attitudes of entrepreneurs in the private sector towards the role of government in SME development through provision of assistance to SMEs in BiH, (ii) the business environment in which firms operate, and (iii) attitudes of the employmed in government sector towards the role of government in SME development through the provision of assistance to SMEs in BiH. The paper reviews the literature on these three approaches and available evidence on relevance to understanding the performance of SMEs as main ...
Barriers to SME Development in Bosnia, Macedonia and Slovenia
The paper is based on the findings of a research project which aimed to identify the critical barriers to small business growth and development in Bosnia, Macedonia Slovenia. The research was based upon a sample survey of small firms, and an econometric analysis of the sources of firms growth. The key barriers identified in the research included factors linked to the institutional environment including bureaucracy, and to external financial constraints including the high cost of capital. Internal organisation and resource issues, and social support through local development coalitions were found to be less important.
Challenges of Rural Smes in Ankara, Turkey
2017
Every year, rural areas are experiencing dramatic demographic loss due to the added value they cannot create and a lack of integration with the industry and services sector established in urban areas. Ankara is one of the most prominent regions of Turkey in terms of advanced technology and per capita regional added value. However, the same success was not achieved in the peripheral districts of Ankara. The aim of this study is to determine the current situation of small and medium-sized enterprises (SMEs) in rural areas that are involved in the production and operation and to identify areas for intervention by identifying the challenges they encounter. In-depth interviews were conducted in the study with business founders and inheritors (78% and 22% respectively). As a result of the study, 93% of rural SMEs consider that businesses operating in rural areas have serious problems. The biggest obstacle in front of entrepreneurship was found finance, followed by technical staffing and administrative and legal obstacles. In order to get over these obstacles, what is most needed to be addressed is finance, machine-equipment support, marketing and promotional support. One of the most important components that will lead to added value increase in rural areas is export. 82% of the companies that participated in the survey stated that they do not export. Therefore, it is necessary to develop export-oriented industrial production in rural areas. As a result of this study, it has been found that the institutional capacities of rural enterprises are very low, and there is a need for a support mechanism in order to improve that capacity. There is also a need for efforts to accelerate the transfer of technology produced in the urban areas to the agriculture, tourism and service sectors in rural areas.
Entrepreneurship in the Balkans, 2013
The economy of Bosnia and Herzegovina and the Republic of Srpska (RS) in the last decade, from 2001 to 2010, according to official statistics, has recorded a significant economic growth. Between 2001 and 2010 GDP in the RS has almost tripled, from 1,478,000 € to 4,250,000 €, respectively (Republic of Srpska Institute of Statistics 2011). This growth is due to the growth of the sector of small and medium-sized enterprises (SMEs) that, in the period between 2006 and 2008, has recorded a growth of SMEs of 8.41 %. The growth has continued in 2009. Out of 14,321 companies, only 55 or 0.38 % were large enterprises. However, in 2010, according to APIF data, 9,472 companies have submitted their required financial reports for the year 2009. Comparing this number with the data from 2009, the question is what happened with other companies? Have they ceased to do business or simply have not fulfilled their legal obligation?
Rural Entrepreneurship-Problem and Prospects: An Empirical Analysis
2019
Rural entrepreneurs play a vital role in the overall economic development of the country. The growth and development of rural entrepreneurship facilitate self employment, results in wider dispersal of economic and industrial activities and helps in the maximum utilization of locally available raw materials and labour. It is fact that the majority of rural entrepreneurs are facing several problems due to lack of basic amenities in rural areas like, lack of education, financial problems, marketing hurdles, management and human resource problems, insufficient technical and conceptual ability etc. Over 70% percent of India‟s population lives in villages areas and majority of people depend on agriculture for their livelihood. The pace of industrialization in West Bengal is slow and tardy. Thus, there is need to strengthen employment opportunities in the rural areas by promoting rural entrepreneurship. The present descriptive study is made in the North Bengal districts of West Bengal base...