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Technology Transfer, Finance Channels, And Sme Performance: New Evidence From Developing Countries

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  • MEHMET HUSEYIN BILGIN

    (Faculty of Political Sciences, Istanbul Medeniyet University, D-100 Karayolu 34732, Goztepe-Kadikoy, Istanbul, Turkey)

  • CHI KEUNG MARCO LAU

    (Faculty of Economics & Administrative Sciences, Zirve University, Gaziantep, Turkey)

  • ENDER DEMIR

    (Advanced School of Economics, Ca' Foscari University of Venice, Venice, Italy)

Abstract

This paper attempts to explore the determinants for small and medium enterprise (SME) performance. In particular, we investigate how training, technology adoption, finance channels and exporting behavior affect SMEs' performance by examining the determinants of theprofit per worker. Using a rich and up to date firm-level dataset, we find evidence that SMEs can improve performance by importing more foreign materials inputs and by utilizing foreign technologies from technologically advanced economies. This effect of technology spillover is particularly important for smaller enterprises in developing countries because in-house innovation is expensive. We further find that both informal finance sources and formal finance channels do not enhance the performance of smaller enterprises in financing daily operations and interestingly, informal channels hamper a firm's performance. There is no evidence for the effect of on-the-job training on firm performance. The exporting behavior of firms measured by the percentage of exports has no significant impact on firm performance.

Suggested Citation

  • Mehmet Huseyin Bilgin & Chi Keung Marco Lau & Ender Demir, 2012. "Technology Transfer, Finance Channels, And Sme Performance: New Evidence From Developing Countries," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 57(03), pages 1-20.
  • Handle: RePEc:wsi:serxxx:v:57:y:2012:i:03:n:s0217590812500208
    DOI: 10.1142/S0217590812500208
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    Cited by:

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    2. Dr. Arif Anjum, 2018. "Impact of Technology Adoption on the Performance of Small and Medium Enterprises in India," The Journal of Social Sciences Research, Academic Research Publishing Group, pages 857-867:5.
    3. Andrew E. Hansen-Addy & Davide M. Parrilli & Ishmael Tingbani, 2024. "The impact of trade facilitation on African SMEs’ performance," Small Business Economics, Springer, vol. 62(1), pages 105-131, January.
    4. Giray Gozgor & Muhlis Can, 2016. "Effects of the product diversification of exports on income at different stages of economic development," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 6(2), pages 215-235, August.
    5. Mita Takahashi, 2020. "Problems of Small and Mid-Sized Enterprises in Japan’s Software Industry," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 8(4), pages 274-278.

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    More about this item

    Keywords

    Technology transfer; finance channels; SME performance; L25;
    All these keywords.

    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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