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SME contributions to employment, job creation, and growth in the Arab world

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  • Nasr, Sahar
  • Rostom, Ahmed

Abstract

Recent economic and political developments have highlighted a challenge shared across the Arab region of generating employment, promoting inclusive growth, and improving competitiveness. In the short run, weakened macroeconomic fundamentals in the developing economies of the Middle East and North Africa are a key challenge. The region's main challenge is to achieve sustainable growth that delivers the quantity and quality of jobs needed. An inclusive and competitive private sector has proven to be one of the most effective and long-term solutions for this challenge. This paper provides an analytical framework to diagnose and identify key challenges to the growth of small and medium enterprises that is supported by a quantitative model based on the World Bank's Enterprise Surveys database. The findings reconfirm that the route to a sustained role for small and medium enterprises in job creation requires improving the credibility of reforms, the effectiveness of policies, and equitable enforcement. Although one size fits all is infeasible for Arab countries, it is important to design policies across sectors to create productive employment and promote economic growth. Supporting innovation and enhancing access to finance are central to the development agenda for small and medium enterprises. And creating an enabling environment and setting up accountable institutions are key to ensure equal opportunity and inclusive growth.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6682.

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Date of creation: 01 Oct 2013
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Handle: RePEc:wbk:wbrwps:6682

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Keywords: Access to Finance; Environmental Economics&Policies; Labor Markets; Microfinance; Labor Policies;

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  1. Magnus Henrekson & Dan Johansson, 2010. "Gazelles as job creators: a survey and interpretation of the evidence," Small Business Economics, Springer, vol. 35(2), pages 227-244, September.
  2. Sahar Nasr, 2010. "Egyptian Women Workers and Entrepreneurs : Maximizing Opportunities in the Economic Sphere," World Bank Publications, The World Bank, number 2414.
  3. Klapper, Leora & Richmond, Christine, 2011. "Patterns of business creation, survival and growth: Evidence from Africa," Labour Economics, Elsevier, vol. 18(S1), pages S32-S44.
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  7. John Haltiwanger & Ron S. Jarmin & Javier Miranda, 2010. "Who Creates Jobs? Small vs. Large vs. Young," Working Papers 10-17, Center for Economic Studies, U.S. Census Bureau.
  8. David Neumark & Brandon Wall & Junfu Zhang, 2011. "Do Small Businesses Create More Jobs? New Evidence for the United States from the National Establishment Time Series," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 16-29, August.
  9. repec:wbk:wboper:13439 is not listed on IDEAS
  10. Werner Hölzl, 2009. "Is the R&D behaviour of fast-growing SMEs different? Evidence from CIS III data for 16 countries," Small Business Economics, Springer, vol. 33(1), pages 59-75, June.
  11. Pierella Paci & Ana Revenga & Bob Rijkers, 2012. "Coping with Crises: Policies to Protect Employment and Earnings," World Bank Research Observer, World Bank Group, vol. 27(1), pages 106-141, February.
  12. repec:wbk:wboper:13435 is not listed on IDEAS
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