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

Sharafat Ali

MPRA Paper from University Library of Munich, Germany

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.

Keywords: Poverty; Small and Medium Enterprises; Income Inequality; Population Growth (search for similar items in EconPapers)
JEL-codes: C32 I30 O14 (search for similar items in EconPapers)
Date: 2013-06, Revised 2113-07
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Citations: View citations in EconPapers (1)

Published in European Journal of Business and Economics 2.8(2013): pp. 25-30

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Journal Article: The Small and Medium Enterprises and Poverty in Pakistan: An Empirical Analysis (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:50506

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