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Is Small Beautiful? Small Enterprise, Aid and Employment in Africa

Author

Listed:
  • Sam Jones
  • John Page
  • Abebe Shimeles
  • Finn Tarp
  • John Page
  • Måns Söderbom

Abstract

type="main" xml:lang="en"> Aid providers often describe small firms as ‘job creators’. But what types of jobs do they create? Drawing on enterprise survey data for nine African countries and panel data for Ethiopia we find that small and large formal sector firms create similar numbers of net jobs. Small firms, however, have much higher turnover of employment and pay persistently lower wages. To create more ‘good’ jobs aid should target the constraints to the growth of firms of all sizes. Improving the ‘investment climate’ and new programs to increase firms' capabilities—through, for example, management training—offer greater prospects for employment creation.

Suggested Citation

  • Sam Jones & John Page & Abebe Shimeles & Finn Tarp & John Page & Måns Söderbom, 2015. "Is Small Beautiful? Small Enterprise, Aid and Employment in Africa," African Development Review, African Development Bank, vol. 27(S1), pages 44-55, October.
  • Handle: RePEc:bla:afrdev:v:27:y:2015:i:s1:p:44-55
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    Cited by:

    1. Florence Crick & Mamadou Diop & Momadou Sow & Birame Diouf & Babacar Diouf & Joseph Muhwanga & Muna Dajani, 2016. "Enabling private sector adaptation in developing countries and their semi-arid regions – case studies of Senegal and Kenya," GRI Working Papers 258, Grantham Research Institute on Climate Change and the Environment.
    2. repec:liu:liucej:v:13:y:2016:i:2:p:221-246 is not listed on IDEAS
    3. Janvier Nkurunziza, 2016. "MSMEs Financing in Burundi and its Welfare Effect," BeFinD Working Papers 0111, University of Namur, Department of Economics.
    4. John Page, 2016. "Industry in Tanzania Performance, prospects, and public policy," WIDER Working Paper Series 005, World Institute for Development Economic Research (UNU-WIDER).
    5. repec:bla:afrdev:v:29:y:2017:i:3:p:376-388 is not listed on IDEAS
    6. Florence Crick, Shaikh Eskander, Sam Fankhauser, Mamadou Diop, 2017. "How do African SMEs respond to climate risks? Evidence from Kenya and Senegal," GRI Working Papers 284, Grantham Research Institute on Climate Change and the Environment.
    7. Tony Addison & Ville Pikkarainen & Risto Rönkkö & Finn Tarp, 2017. "Development and poverty in sub-Saharan Africa," WIDER Working Paper Series 169, World Institute for Development Economic Research (UNU-WIDER).
    8. repec:eee:wdevel:v:108:y:2018:i:c:p:157-168 is not listed on IDEAS
    9. Simplice A. Asongu & Jacinta C. Nwachukwu, 2016. "Rational Asymmetric Development, Piketty and Poverty in Africa," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 13(2), pages 221-246, December.

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