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Who creates jobs in developing countries?

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  • Meghana Ayyagari

    ()

  • Asli Demirguc-Kunt

    ()

  • Vojislav Maksimovic

    ()

Abstract

This paper investigates the contribution of small firms to employment, job creation, and growth in developing countries. While small firms (>20 employees) have the smallest share of aggregate employment, the small and medium enterprise sector’s (>100 employees) contribution is comparable to that of large firms. Small firms have the largest shares of job creation, and highest sales growth and employment growth, even after controlling for firm age. Large firms, however, have higher productivity growth. Conditional on size, young firms are the fastest growing and large mature firms have the largest employment shares but small young firms have higher job creation rates. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Meghana Ayyagari & Asli Demirguc-Kunt & Vojislav Maksimovic, 2014. "Who creates jobs in developing countries?," Small Business Economics, Springer, vol. 43(1), pages 75-99, June.
  • Handle: RePEc:kap:sbusec:v:43:y:2014:i:1:p:75-99
    DOI: 10.1007/s11187-014-9549-5
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Florian LEON, 2018. "Long-Term Finance and Entrepreneurship," CREA Discussion Paper Series 18-01, Center for Research in Economic Analysis, University of Luxembourg.
    2. repec:bla:jecrev:v:68:y:2017:i:2:p:173-187 is not listed on IDEAS
    3. Michael Anyadike-Danes & Carl-Magnus Bjuggren & Sandra Gottschalk & Werner Hölzl & Dan Johansson & Mika Maliranta & Anja Myrann, 2015. "An international cohort comparison of size effects on job growth," Small Business Economics, Springer, vol. 44(4), pages 821-844, April.
    4. Erhardt, Eva, 2017. "Who persistently creates jobs? Absolute versus relative high-growth firms," MPRA Paper 79307, University Library of Munich, Germany.
    5. Paul Vandenberg & Long Q Trinh, 2016. "Is there a Size-Induced Market Failure in Skills Training?," Working Papers id:11386, eSocialSciences.
    6. repec:oup:jecgeo:v:17:y:2017:i:5:p:959-974. is not listed on IDEAS
    7. Ayyagari,Meghana & Demirguc-Kunt,Asli & Maksimovic,Vojislav, 2015. "Are large firms born or made ? evidence from developing countries," Policy Research Working Paper Series 7406, The World Bank.
    8. Diwan, Ishac & Jamal Ibrahim Haidar, "undated". "Do Political Connections Reduce Job Creation? Evidence from Lebanon," Working Paper 414186, Harvard University OpenScholar.
    9. repec:eee:tefoso:v:131:y:2018:i:c:p:326-335 is not listed on IDEAS

    More about this item

    Keywords

    Small and medium enterprises; Employment; Job creation; Growth; L26;

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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