Private Sector Development and Policy Actions in Timor-Leste: Lessons from a Business Mapping Survey

Shigehiro Shinozaki
Additional contact information
Shigehiro Shinozaki: Asian Development Bank

No 837, ADB Economics Working Paper Series from Asian Development Bank

Abstract: This paper empirically investigates what drives the growth of private businesses in Timor-Leste and the policy actions needed to facilitate growth amid global uncertainty, especially for micro, small, and medium-sized enterprises (MSMEs). It uses the linear probability model (LPM) to identify the MSME growth structure and the Oaxaca decomposition to reveal detailed growth factors by firm type in determining which policy areas need to be strengthened. Estimation results show that four types of MSMEs—those formalized, digitalized, internationalized, and women-led —exhibit different business characteristics and performance results compared with control groups. Accordingly, policy support areas differ by firm type, with a focused approach critical in designing and delivering policy assistance to MSMEs in Timor-Leste. The study suggests policy implications to consider when designing an evidence-based MSME policy framework that can maximize the benefits from the country’s recent accession to Association of Southeast Asian Nations membership.

Keywords: digitalization; heterogeneity; Oaxaca decomposition; private sector development; SME development; SME policy; Timor-Leste (search for similar items in EconPapers)
JEL-codes: D22 G20 L20 L50 (search for similar items in EconPapers)
Pages: 39
Date: 2026-02-05
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.adb.org/publications/private-sector-development-timor-leste Full text

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ris:adbewp:022185

Access Statistics for this paper

More papers in ADB Economics Working Paper Series from Asian Development Bank 6 ADB Avenue, Mandaluyong City, 1550 Metro Manila, Philippines. Contact information at EDIRC.
Bibliographic data for series maintained by Orlee Velarde ().