Business Practices in Small Firms in Developing Countries

• 成果类型: Article
• 署名作者: McKenzie, David; Woodruff, Christopher
• 署名单位: The World Bank; University of Warwick
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2016.2492
• 发表日期: 2017
• 页码: 2967-2981
• 关键词: business practices; Small enterprises; PRODUCTIVITY; management

摘要

Management has a large effect on the productivity of medium and large firms. But does management matter in micro and small firms, where the majority of the labor force in developing countriesworks? We develop 26 questions that measure business practices in marketing, stock-keeping, record-keeping, and financial planning. These questions have been administered in surveys in Bangladesh, Chile, Ghana, Kenya, Mexico, Nigeria, and Sri Lanka. We show that variation in business practices explains as much of the variation in outcomes-sales, profits, and labor productivity and total factor productivity-in microenterprises as in larger enterprises. Panel data from three countries indicate that better business practices predict higher survival rates and faster sales growth. The association of business practices with firm outcomes is robust to including numerous measures of the owner's human capital. We find that owners with higher human capital, children of entrepreneurs, and firms with employees employ better business practices.