nach oben

Small Business Economics

Erschienen in:

01.02.2012

SMEs and regional economic growth in Brazil

verfasst von: Túlio A. Cravo, Adrian Gourlay, Bettina Becker

Erschienen in: Small Business Economics | Ausgabe 2/2012

Einloggen

Aktivieren Sie unsere intelligente Suche, um passende Fachinhalte oder Patente zu finden.

search-config

KI-gestützte Suche

Aus

Abstract

This paper examines the relationship between the small and medium-sized enterprise (SME) sector and economic growth for an annual panel of Brazilian states for the period 1985–2004. We investigate the importance of the relative size of the SME sector measured by the share of SME employment in total formal employment and the level of human capital in SMEs measured by the average years of schooling of SME employees. The empirical results indicate that the relative importance of SMEs is negatively correlated with economic growth, a result that is consistent with previous studies examining developing countries. In addition, our results show that the human capital embodied in SMEs may be more important for economic growth than the relative size of the SME sector.

Vorheriger Artikel Partnering with universities: a good choice for nanotechnology start-up firms?

Nächster Artikel Determinants of self-employment survival in Europe

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

über 102.000 Bücher
über 537 Zeitschriften

aus folgenden Fachgebieten:

Automobil + Motoren
Bauwesen + Immobilien
Business IT + Informatik
Elektrotechnik + Elektronik
Energie + Nachhaltigkeit
Finance + Banking
Management + Führung
Marketing + Vertrieb
Maschinenbau + Werkstoffe
Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

über 67.000 Bücher
über 340 Zeitschriften

aus folgenden Fachgebieten:

Bauwesen + Immobilien
Business IT + Informatik
Finance + Banking
Management + Führung
Marketing + Vertrieb
Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Nur mit Berechtigung zugänglich

In 2004, SMEs accounted for approximately 52.5% of the Brazilian labour force (Relação Anual de Informações Sociais). See Table 1 for further details.

According to Baumol (1990), unproductive entrepreneurship takes many forms such as litigation and takeovers, tax evasion and avoidance efforts.

For instance, government policy can improve institutions by reducing the entry cost and the level of taxes that entrepreneurs must pay (Dias and McDermott 2006). Besides, a more efficient judicial system that prevents litigations and tax evasion might provide positive incentives for productive entrepreneurs.

For example, Table 1 in Beck et al. (2005) shows that SMEs’ employment share in Brazil is 58.8% while in Finland it is 58.15%. However, the effect of SMEs on growth is very likely to be different due to different characteristics of the SME sector. Therefore, a proxy for the presence of SMEs does not reflect the true impact of SMEs on growth.

Necessity entrepreneurship defines the act of starting a business as the last resort. In contrast, opportunity entrepreneurship refers to the other motivation for starting a business, i.e. to exploit a perceived business opportunity (Acs et al. 2008).

This is probably linked to the fact that the ratio of opportunity to necessity entrepreneurship is higher in developed countries (see, for instance, Acs et al. 2008).

Population growth is adjusted for depreciation (d) and technological growth (g), under the usual assumption, based on previous results in the literature, that d + g equals 0.05. The term with the population growth in Eq. 2 is ln(n + d + g). This comes from the derivation of the steady-state value of the stock of capital per effective unit of labour in the growth theory. For more details regarding this issue, see Mankiw et al. (1992).

A longer time series is not available due to a change in the national accounts’ methodology from 2004 onwards.

Using annual data allows more degrees of freedom for the relatively short panel time length of our study. However, to control for business cycles we used a 3-year average to reduce its influence. This approach still allows the use of five cross-sections in the GMM-DIFF estimates, since two cross-sections are lost to control for the lagged GDPpc and to take the first difference. Increasing the time length to the usual 5-year average would reduce the degrees of freedom and leave us without the minimum of three cross-sections necessary to calculate the diagnostic tests for the GMM estimates (see Arellano and Bond 1991).

In 2004, RAIS covered 31.5 million workers. If an establishment fails to report the information required by RAIS, employers face fines that are proportional to their workforce size. However, because the payment of the annual wage supplement is based on RAIS, employers and workers have a strong incentive to fulfil RAIS records. The software SGT micro, provided by the Ministry of Labour, was used to retrieve the information necessary to construct our SME measures using the two-digit level of IBGE’s classification of activities.

We also used 100 employees as a cut-off point to define SMEs and found similar results.

The SMEs proxies based on manufacturing and the extended sector with service and commerce provide a reasonable representation of the economy as a whole. In 2004, according to the two-digit level sectoral classification, manufacturing, commerce and services accounted for 68% of the formal employment in Brazil. In addition, the IBGE’s official figures for 2004 show that these sectors were responsible for 67.5% of the Brazilian GDP.

See the appendix for further details.

The regional nature of this study also limits our choice of measures related to the SME sector.

The omission of information in small municipalities is not likely to affect the quality of data at state level. In addition, agriculture, construction and public administration information are not used to construct our SMEs measures.

Brazil is divided into 27 federal units including the Federal District of Brasília. The most recent state (Tocantins) was created in 1988, constituting the northern territory of the former state of Goiás. These two states were excluded from the sample due to concerns with the quality of the data.

Similar nonsignificant results for population growth were found by Nakabashi and Salvato (2007). This result could be related to the fact that income per capita is the main determinant of migration in Brazil. This growth endogeneity may account for the insignificant coefficient.

Acs, Z., & Amorós, J. (2008). Entrepreneurship and competitiveness dynamics in Latin America. Small Business Economics, 31(3), 305–322.CrossRef

Acs, Z., Desai, S., & Hessels, J. (2008). Entrepreneurship, economic development and institutions. Small Business Economics, 31(3), 219–234.CrossRef

Arellano, M., & Bond, S. (1991). Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies, 58(2), 277–297.CrossRef

Audretsch, D. B. (2007). Entrepreneurship capital and economic growth. Oxford Review of Economic Policy, 23(1), 63–78.CrossRef

Audretsch, D., & Keilbach, M. (2004). Entrepreneurship capital and economic performance. Regional Studies, 38(8), 949–959.CrossRef

Audretsch, D., & Thurik, R. (2001). What’s new about the new economy? Sources of growth in the managed and entrepreneurial economics. Industrial and Corporate Change, 10(1), 267–315.CrossRef

Azzoni, C. R. (2001). Economic growth and regional income inequality in Brazil. Annals of Regional Science, 35(1), 133–152.CrossRef

Barro, R. (1991). Economic growth in a cross section of countries. Quarterly Journal of Economics, 106(2), 407–43.CrossRef

Barro, R. (2001). Human capital: Growth, history, and policy—a session to honor Stanley Engerman. Human capital and growth. American Economic Review, 91(2), 12–17.CrossRef

Baumol, W. J. (1990). Entrepreneurship—productive, unproductive, and destructive. Journal of Political Economy, 98(5), 893–921.CrossRef

Baumol, W. (2008). Small enterprises, large firms, productivity growth and wages. Journal of Policy Modeling, 30(4), 575–589.CrossRef

Beck, T., & Demirgüç-Kunt, A. (2006). Small and medium-size enterprises: Access to finance as a growth constraint. Journal of Banking and Finance, 30(11), 2931–2943.CrossRef

Beck, T., Demirgüç-Kunt, A., & Levine, R. (2005). SMEs, growth, and poverty: Cross-country evidence. Journal of Economic Growth, 10(3), 199–229.CrossRef

Beck, T., Demirgüç-Kunt, A., & Maksimovic, V. (2006). The influence of financial and legal institutions on firm size. Journal of Banking and Finance, 30(11), 2995–3015.CrossRef

Blundell, R., & Bond, S. (1998). Initial conditions and moment restrictions in dynamic panel data models. Journal of Econometrics, 87(1), 111–143.CrossRef

Dias, J., & McDermott, J. (2006). Institutions, education, and development: The role of entrepreneurs. Journal of Development Economics, 80(2), 299–328.CrossRef

Djankov, S., McLiesh, C., & Ramalho, R. M. (2006). Regulation and growth. Economics Letters, 92(3), 395–401.CrossRef

Durlauf, S., Johnson, P., & Temple, J. (2005). Growth econometrics. In P. Aghion & S. Durlauf (Eds.), Handbook of economic growth (Chap. 8). Amsterdam: Elsevier.

Ferreira, A. (2000). Convergence in Brazil: Recent trends and long-run prospects. Applied Economics, 32(4), 479–489.CrossRef

Gries, T., & Naudé, W. (2010). Entrepreneurship and structural economic transformation. Small Business Economics, 34(1), 13–29.CrossRef

Griffith, R., Redding, S., & Van Reenen, J. (2004). Mapping the two faces of R&D: Productivity growth in a panel of OECD industries. The Review of Economics and Statistics, 86(4), 883–895.CrossRef

Islam, N. (1995). Growth empirics: A panel data approach. Quarterly Journal of Economics, 110(4), 1127–1170.CrossRef

Lau, L. J., Jamison, D. T., Liu, S. C., & Rivkin, S. (1993). Education and economic growth: Some cross-sectional evidence from Brazil. Journal of Development Economics, 41(1), 45–70.CrossRef

Levine, R., & Renelt, D. (1992). A sensitivity analysis of cross-country growth regressions. American Economic Review, 82(4), 942–963.

Lewis, W. A. (1954). Economic development with unlimited supplies of labour. The Manchester School, 22(2), 139–191.CrossRef

Lewis, W. A. (1979). The dual economy revisited. The Manchester School, 47(3), 211–229.CrossRef

Mankiw, G., Romer, D., & Weil, D. (1992). A contribution to the empirics of economic growth. Quarterly Journal of Economics, 107(2), 404–437.CrossRef

Michelacci, C., & Silva, O. (2007). Why so many local entrepreneurs?. Review of Economics and Statistics, 89(4), 615–633.CrossRef

Mueller, P. (2007). Exploiting entrepreneurial opportunities: The impact of entrepreneurship on growth. Small Business Economics, 28(4), 355–362.CrossRef

Muendler, M. (2007). Trade and workforce changeover in Brazil. National Bureau of Economic Research (NBER), Working papers no. 12980.

Nakabashi, L., & Salvato, M. (2007). Human capital quality in the Brazilian states. Revista ANPEC, 8(2), 211–229.

Nelson, R., & Phelps, E. (1966). Investment in humans, technological diffusion, and economic growth. American Economic Review, 56(1/2), 65–75.

North, D. C. (1994). Economic performance through time. The American Economic Review, 84(3), 359–368.

Nystrom, K. (2008). The institutions of economic freedom and entrepreneurship: evidence from panel data. Public Choice, 136(3-4), 269–282.CrossRef

Roodman, D. (2009). How to do xtabond2: An introduction to difference and system GMM in Stata. Stata Journal, 9(1), 86–136.

Sala-i-Martin, X. (2002). 15 Years of new growth economics: What have we learnt? Universitat Pompeu Fabra economics and business working paper no. 620

Solow, R. (1956). A contribution to the theory of economic growth. Quarterly Journal of Economics, 70(1), 65–94.CrossRef

Solow, R. (2007). The last 50 years in growth theory and the Next 10. Oxford Review of Economic Policy, 23(1), 3–14.CrossRef

Temple, J. (1999). The new growth evidence. Journal of Economic Literature, 37(1), 112–156.CrossRef

Van Stel, A., Carree, M., & Thurik, R. (2005). The effect of entrepreneurial activity on national economic growth. Small Business Economics, 24(3), 311–321.CrossRef

Wennekers, S., & Thurik, R. (1999). Linking entrepreneurship and economic growth. Small Business Economics, 13(1), 27–55.CrossRef

Wennekers, S., Van Stel, A., Thurik, R., & Reynolds, P. (2005). Nascent entrepreneurship and the level of economic development. Small Business Economics, 24(3), 293–309.CrossRef

Titel: SMEs and regional economic growth in Brazil
verfasst von: Túlio A. Cravo
Adrian Gourlay
Bettina Becker
Publikationsdatum: 01.02.2012
Verlag: Springer US
Erschienen in: Small Business Economics / Ausgabe 2/2012
Print ISSN: 0921-898X
Elektronische ISSN: 1573-0913
DOI: https://doi.org/10.1007/s11187-010-9261-z

Springer Professional

Abstract

Bitte loggen Sie sich ein, um Zugang zu Ihrer Lizenz zu erhalten.

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Springer Professional "Wirtschaft"

Weitere Artikel der Ausgabe 2/2012

Erratum to: Determinants of self-employment survival in Europe

Financing new venture exporters

Job satisfaction and self-employment: autonomy or personality?

Partnering with universities: a good choice for nanotechnology start-up firms?

Valuing an entrepreneurial enterprise

Determinants of self-employment survival in Europe

Premium Partner