SMEs’ Finance and Participation in Global Markets . 20.06.2012 Koji ITO Centre for Entrepreneurship, SMEs and Local Development (CFE) Organisation for Economic Co-operation and Development (OECD) [email protected] 1 Researches of SMEs’ international activity by OECD.
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“Fostering Small and Medium-sized Enterprises’ (SMEs) Participation in Global Markets” (2011-12)
a. Exporting firms are rare and highly skewed. Only a few firms dominate the share of export.
b. Exporting firms have higher value added, employ more, and are more capital-intensive and productive than non exporting firms.
c. Firms conducting FDI have higher premia than exporting firms.
d. Export propensity is proportional to firm size.
exporting firms (with positive exporting turnover)
FDI firms (with foreign affiliates)
domestic firms (without exporting and foreign affiliates).
Premiums of employees and productivity
Note: Premium = (mean of international firms) / (mean of domestic firms)
Productivity = Value added / Employees
a. Every financial indicator has no significant coefficient in every industry.
b. The lag variable of the explained variable has a strong positive effect.
c. Firm size (employees), productivity added/employee) and firm age also have a significant positive effect.
“ Financial indicators may have an effect when SMEs enter markets with high entrance barriers.”
a. In many countries, a production function, namely positive relationship of productivity and capital-labour ratio, can be confirmed based on firm-level data.
b. It is also broadly confirmed that firms’ investment is affected by their financial constraints.
c. Hence reducing financial constraints of SMEs increases their productivity through investment and the probability of exporting and FDI.
Distribution of productivity
Top priority is
to raise productivity.
Main target of financial support
Firm with high productivity
(No need of financial support ?)
a. Cooperation between different organizations in public sector
b. Cooperation between the private and public sector
c. Securing human resources to evaluate firms’ potential of internationalisation and decide the proper supports for them