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Productivity in the Small Manufacturing Enterprises: Determinants and Policy Issues


  • Mukherjee, Dipa


The role of Micro and Small Enterprises (MSEs) in employment creation is widely acknowledged. But their contribution to national income is questioned because of their low productivity. The present paper tries to identify important determinants of productivity level in Small Manufacturing Enterprises (SMEs) and suggest appropriate policies for augmenting productivity levels therein. Factors like technology, access to resources and inputs, general macroeconomic atmosphere, etc. emerge as important determinants of productivity. A close association between productivity levels and emolument per worker is also observed. Policies for proper development of these enterprises should include technological upgradation, better access to land ownership and formal credit system, improvement of general economic condition of the states, ensuring remunerative wages and better working conditions etc. For best results, a targeted approach is recommended and for that Focus groups, both at National and State level, have been identified. A co-ordinated approach is the need of the hour.

Suggested Citation

  • Mukherjee, Dipa, 2004. "Productivity in the Small Manufacturing Enterprises: Determinants and Policy Issues," MPRA Paper 4867, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:4867

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    References listed on IDEAS

    1. Banerjee, Biswajit, 1983. "The Role of the Informal Sector in the Migration Process: A Test of Probabilistic Migration Models and Labour Market Segmentation for India," Oxford Economic Papers, Oxford University Press, vol. 35(3), pages 399-422, November.
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    Cited by:

    1. Rajesh Raj, Seethamma Natarajan, 2007. "Technical Efficiency in the Informal Manufacturing Enterprises: Firm level evidence from an Indian state," MPRA Paper 7816, University Library of Munich, Germany.
    2. Dipa Mukherjee & Rajarshi Majumder, 2007. "Efficiency, technological progress and regional comparative advantage: a study of the organized manufacturing sector in India," Asia-Pacific Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 14(2), pages 23-54, December.
    3. Kathuria, Vinish & Seethamma Natarajan, Rajesh Raj & Sen, Kunal, 2010. "State business relations and manufacturing productivity growth in India," MPRA Paper 20314, University Library of Munich, Germany.
    4. Kathuria, Vinish & Seethamma Natarajan, Rajesh Raj & Sen, Kunal, 2010. "Organized versus Unorganized Manufacturing Performance in India in the Post-Reform Period," MPRA Paper 20317, University Library of Munich, Germany.

    More about this item


    Productivity; Micro-enterprises; Total Factor Productivity; Technology;

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General


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