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Supplier development programs and firm performance: evidence from Chile

Author

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  • Irani Arráiz
  • Francisca Henríquez
  • Rodolfo Stucchi

Abstract

This paper evaluates the impact of the Chilean Supplier Development Program, aimed at improving and stabilizing the commercial linkages between small and medium-sized suppliers and their large firm customers, during the period 2003–2008. We use the panel structure of our dataset to control for observables and time-invariant unobservable factors that affect the participation and performance of firms. We find that both small and medium enterprises and large firms benefited from the coordination efforts. The program increased sales, employment, and the sustainability of small and medium-sized suppliers; it also increased the sales of large firms and raised their ability to become exporters. In addition, we find that the timing of the effect is different for suppliers and large firms. While the effect on suppliers appeared 1 year after the firms enrolled in the program, the effect on large firms took 2 years to appear. Copyright Springer Science+Business Media, LLC. 2013

Suggested Citation

  • Irani Arráiz & Francisca Henríquez & Rodolfo Stucchi, 2013. "Supplier development programs and firm performance: evidence from Chile," Small Business Economics, Springer, vol. 41(1), pages 277-293, June.
    • Handle: RePEc:kap:sbusec:v:41:y:2013:i:1:p:277-293
    DOI: 10.1007/s11187-012-9428-x
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    References listed on IDEAS

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    2. Lucas Figal Garone & Alessandro Maffioli & Joao Negri & Cesar Rodriguez & Gonzalo Vázquez-Baré, 2015. "Cluster development policy, SME’s performance, and spillovers: evidence from Brazil," Small Business Economics, Springer, vol. 44(4), pages 925-948, April.
    3. Tulio Cravo & Caio Piza, 2016. "The Impact of Business Support Services for Small and Medium Enterprises on Firm Performance in Low -and Middle- Income Countries: A Meta-Analysis," IDB Publications (Working Papers) 94938, Inter-American Development Bank.
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    5. Grimm, Michael & Paffhausen, Anna Luisa, 2015. "Do interventions targeted at micro-entrepreneurs and small and medium-sized firms create jobs? A systematic review of the evidence for low and middle income countries," Labour Economics, Elsevier, vol. 32(C), pages 67-85.
    6. Lucas Figal Garone & Paula A. López Villalba & Alessandro Maffioli & Christian A. Ruzzier, 2020. "Productivity differences among firms in Latin American and the Caribbean," Working Papers 136, Universidad de San Andres, Departamento de Economia, revised Jan 2020.
    7. Ismail Abdi Changalima & Ismail Juma Ismail & Alban Dismas Mchopa, 2021. "A review of the forms, rationale, and challenges of supplier development in public procurement: lessons for public buyers in Tanzania," Future Business Journal, Springer, vol. 7(1), pages 1-10, December.
    8. Boneu, Franco & Giuliodori, David & Maffioli, Alessandro & Rodríguez, Alejandro & Stucchi, Rodolfo, 2014. "The spillover effects of the ICT cluster support in Córdoba," MPRA Paper 60307, University Library of Munich, Germany.
    9. Victoria Castillo & Lucas Figal Garone & Alessandro Maffioli & Moira Ohaco, 2016. "Asistencias técnicas y competitividad de las MiPyMEs: Evidencia para Argentina," IDB Publications (Working Papers) 96960, Inter-American Development Bank.
    10. Victoria Castillo & Alessandro Maffioli & Sofía Rojo & Rodolfo Stucchi, 2014. "The effect of innovation policy on SMEs’ employment and wages in Argentina," Small Business Economics, Springer, vol. 42(2), pages 387-406, February.
    11. Giuliani, Elisa & Maffioli, Alessandro & Pacheco, Manuel & Pietrobelli, Carlo & Stucchi, Rodolfo, 2014. "Evaluating the Impact of Cluster Development Programs," Papers in Innovation Studies 2014/10, Lund University, CIRCLE - Centre for Innovation Research.
    12. Xavier Cirera & Marcio Cruz & Elwyn Davies & Arti Grover & Leonardo Iacovone & Jose Ernesto Lopez Cordova & Denis Medvedev & Franklin Okechukwu Maduko & Gaurav Nayyar & Santiago Reyes Ortega & Jesica , 2021. "Policies to Support Businesses through the COVID-19 Shock: A Firm Level Perspective [Economic Uncertainty before and during the COVID-19 Pandemic]," The World Bank Research Observer, World Bank, vol. 36(1), pages 41-66.
    13. Grover,Arti Goswami & Imbruno,Michele, 2020. "Using Experimental Evidence to Inform Firm Support Programs in Developing Countries," Policy Research Working Paper Series 9461, The World Bank.
    14. Yassin Sabha & Yan Liu & Wim Douw, 2020. "Investment Linkages and Incentives," World Bank Publications - Reports 33760, The World Bank Group.
    15. Krammer, Sorin M.S. & Strange, Roger & Lashitew, Addisu, 2018. "The export performance of emerging economy firms: The influence of firm capabilities and institutional environments," International Business Review, Elsevier, vol. 27(1), pages 218-230.
    16. Ricci, Riccardo & Battaglia, Daniele & Neirotti, Paolo, 2021. "External knowledge search, opportunity recognition and industry 4.0 adoption in SMEs," International Journal of Production Economics, Elsevier, vol. 240(C).
    17. Reeg, Caroline, 2015. "Micro and small enterprises as drivers for job creation and decent work," IDOS Discussion Papers 10/2015, German Institute of Development and Sustainability (IDOS).
    18. Suzuki, Aya & Igei, Kengo, 2017. "Can Efficient Provision of Business Development Services Bring Better Results for SMEs?: Evidence from a Networking Project in Thailand," Working Papers 147, JICA Research Institute.
    19. Beza Muche Teka, 2022. "Determinants of the sustainability and growth of micro and small enterprises (MSEs) in Ethiopia: literature review," Journal of Innovation and Entrepreneurship, Springer, vol. 11(1), pages 1-16, December.
    20. World Bank Group, 2016. "Special Economic Zones in the Dominican Republic," World Bank Publications - Reports 26103, The World Bank Group.
    21. Juan S. Blyde & Christian Volpe Martincus & Danielken Molina, 2014. "Fábricas sincronizadas: América Latina y el Caribe en la era de las Cadenas Globales de Valor," IDB Publications (Books), Inter-American Development Bank, number 86755 edited by Juan S. Blyde, February.
    22. Victoria Castillo & David Giuliodori & Alessandro Maffioli & Alejandro Rodríguez & Sofía Rojo & Rodolfo Stucchi, 2014. "El impacto del apoyo al cluster de TIC de la ciudad argentina de Córdoba," IDB Publications (Working Papers) 84673, Inter-American Development Bank.
    23. Irani Arráiz & Marcela Meléndez & Rodolfo Stucchi, 2014. "Partial credit guarantees and firm performance: evidence from Colombia," Small Business Economics, Springer, vol. 43(3), pages 711-724, October.
    24. Jordaan,Jacob Arie & Douw,Willem & Qiang,Zhenwei, 2020. "Multinational Corporation Affiliates, Backward Linkages, and Productivity Spillovers in Developing and Emerging Economies : Evidence and Policy Making," Policy Research Working Paper Series 9364, The World Bank.

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    More about this item

    Keywords

    Supplier Development Program (Programa de Desarrollo de Proveedores; PDP); Small and medium enterprise (SME) policy; Impact evaluation; Chile; D04; D78; L38; L26;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • L38 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Policy
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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