Assessing the Efficiency Costs of Vietnam's ‘Missing’ Small and Medium Sized Enterprises: A Panel Data Investigation

Trung Dang Le and Paul Shaffer

Asia and the Pacific Policy Studies from Crawford School of Public Policy, The Australian National University

Abstract: This article investigates whether there are efficiency costs associated with the pronounced rightward skew in the firm size distribution, or Vietnam's ‘missing small and medium size enterprise (SMEs)’, drawing on panel data analysis of firm growth and survival. Specifically, it examines if factor allocation biases with respect to credit, preferable treatment of state owned enterprises, barriers to entry into export markets and economies of scale are important determinants of growth rates and survival probabilities of small, medium and large-sized firms. Overall, findings on the earlier variables do not support the view that there are large efficiency costs associated with Vietnam's ‘missing SMEs’. Together with other results in the literature with do not find significant equity costs associated with Vietnam's ‘missing SMES’, these findings raise questions about policy initiatives in support of SMEs in Vietnam, such as the National SME Support program, in particular, through improved access to credit.

Keywords: firm survival; firm growth; SMEs; panell data; Vietnam (search for similar items in EconPapers)
Pages: 20 pages
Date: 2017-02-16
New Economics Papers: this item is included in nep-bec, nep-eff, nep-sbm and nep-sea
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Published in Asia & the Pacific Policy Studies, Feb 2017, pages 50-69

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Persistent link: https://EconPapers.repec.org/RePEc:een:appswp:201704

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