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The Small and Medium Enterprises and Poverty in Pakistan: An Empirical Analysis

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  • Ali, Sharafat

Abstract

Small and Medium Enterprises (SMEs) are considered to play an important role in the economic growth, employment generation and poverty alleviation in the economy. The annual time series data is used for examination of impact of SMEs on poverty in Pakistan for the period of 1972-2008. The study utilizes Johansen cointegration and error correction mechanism to examine long run and short impacts small scale industries and other explanatory variable on poverty in Pakistan. The results of the study confirm a strong and poverty alleviating impact of small scale industries’ output in Pakistan. The study suggests the economic policy makers to focus on the establishment of formal financial markets to overcome the financial constraints faced by the SME sector in Pakistan. Simplification of lending procedures, enforcement of credit rights, and reduction in credit costs would be helpful for the establishment of robust SME sector in Pakistan.

Suggested Citation

  • Ali, Sharafat, 2013. "The Small and Medium Enterprises and Poverty in Pakistan: An Empirical Analysis," MPRA Paper 50506, University Library of Munich, Germany, revised Jul 2113.
    • Handle: RePEc:pra:mprapa:50506
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    Cited by:

    1. Faiza Manzoor & Longbao Wei & Mohammad Nurunnabi & Qazi Abdul Subhan, 2019. "Role of SME in Poverty Alleviation in SAARC Region via Panel Data Analysis," Sustainability, MDPI, vol. 11(22), pages 1-14, November.
    2. Sharafat, Ali & Hamid, Waqas & Muhammad, Asghar & Raheel Abbas, Kalroo & Muhammad, Ayaz & Mukhtyar, Khan, 2013. "Foreign Capital and Investment in Pakistan: A Cointegration and Causality Analysis," MPRA Paper 55640, University Library of Munich, Germany, revised 28 Apr 2013.
    3. Syed Hussain Haider & Muzaffar Asad & Minaa Fatima & Rana Zain Ul Abidin, 2017. "Microfinance and Performance of Micro and Small Enterprises: Does Training have an Impact," Journal of Entrepreneurship and Business Innovation, Macrothink Institute, Journal of Entrepreneurship and Business Innovation, vol. 4(1), pages 113-113, December.

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    More about this item

    Keywords

    Poverty; Small and Medium Enterprises; Income Inequality; Population Growth;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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