European integration and the survival of Polish small enterprises

Small and Medium sized Enterprises (SMEs) have a crucial role in the economies of both the developed and developing countries. In the OECD area, the share of SMEs to total employment is between 40 and 80 percent, while their share to GDP is between 30 and 70 percent. Poland, as a country in transition, has undergone in the last decade a second period of rapid economic transformation. This time, the transformation is taking place in the context of its future full economic and monetary integration with the European Union (EU) countries. It must be stressed that economic adjustments need to be rapid as Poland is willing to be in the front line of the countries that will enter the EU in the very near future. In this economic transformation, Polish SMEs have an important role to play. Since they constitute a large part of the Polish economy in terms of output and employment, their survival and development are going to exert a significant impact on Poland’s readiness for accession and on its successful European future. For these reasons, it is of a great importance to estimate the ability of SMEs in Poland to survive and develop and the factors that are associated with this survival and growth in the European perspective. The purpose of this chapter is to investigate the characteristics of the successful SME in the European context and to construct a model that will enable us to predict the probability of an enterprise to survive and develop in this environment.