Entrepreneur: Government and Medium Enterprises Essay

Submitted By xuhelin0713
Words: 1218
Pages: 5
Open Document
Abstract
Small and medium enterprises play a vital role in almost countries. Small and medium enterprises are able to not only improve employment rate but also they are sources of innovation. However, compared to large firms, small and medium enterprises are more likely to fail. The reason is that small and medium enterprises many lack collateral or may have poor book-keeping records. They may also have a higher interest rate than the large firms. As a result, government and public policy should facilitate the development of small and medium enterprises. Government needs to encourage foreign enterprises to set up the business in their countries, or build greater foreign owned joint ventures with domestic small and medium enterprises. Public policy and government should promote the innovation of the small and medium enterprises.

Introduction
SMEs is defined as small and medium enterprises. SMEs are said to be responsible for the driver of innovation and competition in economic sectors. Nowadays it is also widely said that SMEs are one of the most important and powerful drivers of growth in the modern global economy. This essay will discuss the roles of small and medium enterprises played in the economy. It will also discuss how the government facilitate the development of small and medium enterprises.
Body
Small and medium enterprises play a vital role in almost countries, especially in developing countries. Economic growth happens not due to broad improvements in technology, productivity and available resources, but according to Schaper & Volery &Weber &Lewis(2011, p14), "because entrepreneurs (a)improve their technology, organization and processes,(b)become more productive and innovative and (c) force other firms out of business. Schaper & Volery &Weber &Lewis(2011) also point out that due to the increasing small and medium enterprises, there are more and more new and better jobs and overall level of productivity rises, and economic well-being increases. According to Dun & Bradstreet data, Birch's(1979) research claims that the small and medium firms created more than 80 per cent of net new jobs in American economy in the period between 1969 and 1976. Small and medium enterprises assistance policies have become a section of industrial policy not only in developed countries, but also in developing countries for several years. For the developed countries, there are three main increasing contribution of small and medium enterprises. Firstly, industrial restructuring leads to downsizing of large enterprises in the 1970s. Secondly, small and medium enterprises lead to privatization and market deregulation during the period between 1980s and 1990s. In recent years, small and medium enterprises contribute to decrease the importance of scale economies, and increase wealth and develop the niche markets. Deakins and Freeal (chater2) point out that small and medium enterprises play a important role in providing jobs in the southern European countries, such as Spain and Italy. For the developing countries, small and medium enterprises have a vital role in alleviating poverty. Small and medium enterprises play a vital role in innovation. According to Schaper & Volery &Weber &Lewis(2011,p12), "the innovations developed by entrepreneurs often increase productivity and improve general living standards".

The main problem faced by small and medium enterprises not only in developed countries but also in developing countries is lack of access to finance. Levitsky (1996) argues that finance has a significant effect on the ability of an enterprise, for example, the growth of the firm, the promotion of its technology, expansion of the markets, improvement of the management capabilities, or survival of the firm. And also, Lattimore et all. (1998) point out that banks always have difficulty in measuring loans to small and medium enterprises due to the lack of detailed and accurate financial
Show More

Related Documents: Entrepreneur: Government and Medium Enterprises Essay

Literature Review In Literature

different countries to progress. Furthermore examples of great entrepreneur is mention and pointed out, which the researcher think will be an example to readers who are tempted to explore the entreneurial world.The women implication in the SME world is also pointed out. There is the fact that women are more involve in small business creation than…

Words 748 - Pages 3

The Benefits Of Alternative Energy Sources

challenges for small to medium enterprises (SMEs). Outline the benefits of these alternative energy sources and discuss how SMEs can overcome the challenges and take advantage of these benefits. Overcoming the challenges of alternative energy for small to medium enterprise As the world’s consumption of fossil fuel energy continues to increase, so too does societal concern about global warming and emphasis on the transition to alternative energy sources by small to medium enterprise (SME). Although there…

Words 1980 - Pages 8

The Nature Of Business

satisfy their needs and wants and this in turn provides choice for consumers. 7. Entrepreneurship and risks: entrepreneurs take risks and develop strategies for their ideas to come to fruition in order to explore untapped markets. Businesses also provide export revenue to assist growth in the Australian economy. The distribution of wealth created by a business: Governments: Taxes e.g. income tax, GST – used for welfare payments (transfer payments) Business Owners/Shareholders: profit…

Words 1890 - Pages 8

paper final F

Germany in International Comparison Course: International Entrepreneurship Research & Practice Abstract The importance of entrepreneurial activities is integral to a nation’s economic growth. This paper reviews the results of the 2000 Global Entrepreneur Monitor (GEM) country report with a sole focus on Germany in evaluating its degree of entrepreneurship. The factors examined include the costs, legal procedures, and institutional context via a look at the formal and informal entrepreneurial frameworks…

Words 4875 - Pages 20

Advantages Of Free Enterprise System

The free enterprise system has aided us as Americans, and what we stand for, throughout our entire American history. As citizens, we inherit many precious rights and freedoms. We hold these privileges dear to our hearts ,and that love of freedom is what shapes this country. One of the most prodigious privileges is the free enterprise system. The free enterprise system is seen as an essential component to a market economy. It’s an economic system where every single individual has the opportunity to…

Words 1467 - Pages 6

Essay about The Story of a High-Tech Entrepreneur in a Low-Tech World

DREAM DEFFERED: THE STORY OF A HIGH-TECH ENTREPRENEUR IN A LOW-TECH WORLD INTERNATIONALIZATION OF SMALL AND MEDIUM ENTERPRISES MIDTERM 2011 PREPARED BY: LAURA PLANTJE PREPARED FOR: ERNESTO TAPIAS-MOORE MARCH 9, 2011 INTRO: Monique Maddy is a Harvard Business School graduate turned visionary entrepreneur who founded Adesemi Communications International. Adesemi was supposed to revolutionize the information technology sector in her home continent of Africa, by enabling thousands of…

Words 2128 - Pages 9

Essay on New Business

GLOBAL BUSINESS ENVIRONMENT CANADABUSINESS.CA THESE CAN BE 20 USEFUL POINTS TO START THE BUSINESS 1) Business Idea - It is very necessary to find out the business idea which will lead you in the industry, it is important if you want to start new entrepreneur. To do this, we need to understand the value proposition you're creating. Estimate the economics as best you can so as to figure out ahead of time if customers will actually agree to purchase your product or service for significantly more than…

Words 965 - Pages 4

Evaluating Published Research Problems

the barriers, challenges, and opportunities of strategic CSR implementation in small businesses. Greers (2014) states examinations of CSR implementation in small businesses have often not been separate from examinations of CSR implementation in medium and large-scale businesses. Bronn and Vidaver-Cohen (2009) conducted a study of more than 500 businesses to examine decision makers’ views about why their companies engaged in social initiatives. Their efforts were directed to organizations in…

Words 2007 - Pages 9

Logistics: Management and Www. Ccsenet. Org / Ijbm International Journal Essay

www.ccsenet.org/ijbm International Journal of Business and Management Vol. 7, No. 3; February 2012 The Effects of the External Environment on Internal Management Strategies within Micro, Small and Medium Enterprises; Kenyan Case W L Njanja School of Business, Kabarak University (ex student, UNISA) Nakuru-Eldama Ravine Highway Private Bag - 20157 KABARAK, Kenya E-mail: lnjanja@kabarak.ac.ke Martin Ogutu Department of Business Administration University of Nairobi, Kenya E-mail: Ogutum@uonbi…

Words 6926 - Pages 28

Differentiate Between A Command System And A Market System

ownership of resources. 2. Markets and prices coordinate and direct economic activity. 3. Each participant acts in his or her own self-interest. 4. In pure capitalism the government plays a very limited role. 5. In the U.S. version of capitalism, the government plays a substantial role. III. Characteristics of the Market System A. Private individuals and firms own most of the private property (land and capital). 1. Private property, coupled with…

Words 2263 - Pages 10