Working Paper

Business Practices in Small Firms in Developing Countries

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collection.link.5
https://openknowledge.worldbank.org/handle/10986/9
collection.name.5
Policy Research Working Papers
dc.contributor.author
McKenzie, David
dc.contributor.author
Woodruff, Christopher
dc.date.accessioned
2015-09-23T19:00:29Z
dc.date.available
2015-09-23T19:00:29Z
dc.date.issued
2015-08
dc.date.lastModified
2021-04-23T14:04:10Z
dc.description.abstract
Management has a large effect on the productivity of large firms. But does management matter in micro and small firms, where the majority of the labor force in developing countries works? This study developed 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. This paper shows 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 effect of business practices is robust to including many measures of the owner’s human capital. The analysis finds that owners with higher human capital, children of entrepreneurs, and firms with employees employ better business practices. Competition has less robust effects.
en
dc.identifier
http://documents.worldbank.org/curated/en/2015/08/24959833/business-practices-small-firms-developing-countries
dc.identifier.uri
http://hdl.handle.net/10986/22662
dc.language
English
dc.language.iso
en_US
dc.publisher
World Bank, Washington, DC
dc.relation.ispartofseries
Policy Research Working Paper;No. 7405
dc.rights
CC BY 3.0 IGO
dc.rights.holder
World Bank
dc.rights.uri
http://creativecommons.org/licenses/by/3.0/igo/
dc.subject
PARTICULAR COUNTRY
dc.subject
BUSINESS EXPENSES
dc.subject
EQUIPMENT
dc.subject
ACCOUNTING
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CUSTOMER
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COMPETITIONS
dc.subject
GOOD PRACTICES
dc.subject
MATERIALS
dc.subject
INCOME
dc.subject
INTEREST
dc.subject
SALES
dc.subject
MEDIUM ENTERPRISES
dc.subject
EXCHANGE
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COST OF FINANCE
dc.subject
INFORMATION
dc.subject
DEVELOPING COUNTRIES
dc.subject
SELLING
dc.subject
POLITICAL ECONOMY
dc.subject
INTERNATIONAL LABOUR ORGANIZATION
dc.subject
FINANCIAL STATEMENTS
dc.subject
IMPACTS
dc.subject
DISTRIBUTION
dc.subject
FINANCIAL STATEMENT
dc.subject
CASHFLOW
dc.subject
FACTORS OF PRODUCTION
dc.subject
CAPITAL STOCK
dc.subject
PRICE
dc.subject
PLANNING
dc.subject
RETAIL TRADE
dc.subject
QUALITY
dc.subject
REPORTING
dc.subject
TRAINING COURSE
dc.subject
OPEN ACCESS
dc.subject
ECONOMIC ACTIVITY
dc.subject
HUMAN RESOURCE
dc.subject
LABOR MARKET
dc.subject
DATA
dc.subject
ADVERTISING
dc.subject
FINANCIAL PLANNING
dc.subject
TARGETS
dc.subject
PRODUCTIVITY
dc.subject
FINANCIAL PERFORMANCE
dc.subject
MARKETING
dc.subject
WEB
dc.subject
LINKS
dc.subject
BUSINESS PRACTICES
dc.subject
PRIVATE SECTOR DEVELOPMENT
dc.subject
MATERIAL
dc.subject
MIDDLE-INCOME COUNTRIES
dc.subject
INVENTORIES
dc.subject
INVENTORY
dc.subject
BALANCE SHEET
dc.subject
SUBSIDIES
dc.subject
MARKET PRICE
dc.subject
TAXES
dc.subject
EXPENDITURE
dc.subject
MANUFACTURING
dc.subject
COSTING
dc.subject
TECHNOLOGY
dc.subject
HUMAN CAPITAL
dc.subject
TRAINING COURSES
dc.subject
INSPECTION
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BUSINESS PLAN
dc.subject
EXPENSES
dc.subject
AUDITORS
dc.subject
SMALL ENTERPRISES
dc.subject
CAPITAL STOCK
dc.subject
TIME FRAME
dc.subject
BEST PRACTICES
dc.subject
RESULTS
dc.subject
TRAINING WORKSHOP
dc.subject
TURNOVER
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ELECTRICITY
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DAY-TO-DAY OPERATIONS
dc.subject
COUNTRY DUMMIES
dc.subject
WORKING CAPITAL
dc.subject
MAINTENANCE
dc.subject
FINANCIAL PERFORMANCE
dc.subject
FIRM PERFORMANCE
dc.subject
COST
dc.subject
PRIVATE SECTOR
dc.subject
BALANCE SHEET
dc.subject
MIDDLE- INCOME COUNTRIES
dc.subject
MARKET COMPETITION
dc.subject
OUTPUT
dc.subject
RESULT
dc.subject
TRADE
dc.subject
BANK LOAN
dc.subject
BUSINESS
dc.subject
BUSINESS SECTOR
dc.subject
BUSINESSES
dc.subject
BUSINESS PRACTICE
dc.subject
PERFORMANCE
dc.subject
SALES GROWTH
dc.subject
FINANCIAL PLANNING
dc.subject
INNOVATION
dc.subject
PROFIT
dc.subject
MISSING VALUES
dc.subject
RAPID GROWTH
dc.subject
AUDIT
dc.subject
CUSTOMERS
dc.subject
FIRM GROWTH
dc.subject
PROFITS
dc.subject
BUSINESS PERFORMANCE
dc.subject
GROWTH POTENTIAL
dc.subject
TARGET
dc.subject
SMALL BUSINESSES
dc.subject
PRICES
dc.subject
USES
dc.subject
COST OF CAPITAL
dc.subject
CASH FLOW
dc.subject
AUDITING
dc.subject
BUSINESS TRAINING
dc.subject
COMPETITION
dc.title
Business Practices in Small Firms in Developing Countries
en
dc.type
Working Paper
en
okr.date.disclosure
2015-08-27
okr.doctype
Publications & Research
okr.doctype
Publications & Research :: Policy Research Working Paper
okr.docurl
http://documents.worldbank.org/curated/en/2015/08/24959833/business-practices-small-firms-developing-countries
okr.globalpractice
Finance and Markets
okr.googlescholar.linkpresent
yes
okr.identifier.doi
10.1596/1813-9450-7405
okr.identifier.externaldocumentum
090224b0830a0251_1_0
okr.identifier.internaldocumentum
24959833
okr.identifier.report
WPS7405
okr.language.supported
en
okr.pdfurl
http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2015/08/27/090224b0830a0251/1_0/Rendered/PDF/Business0pract0developing0countries.pdf
en
okr.region.country
Bangladesh
okr.region.country
Chile
okr.region.country
Ghana
okr.region.country
Kenya
okr.region.country
Mexico
okr.region.country
Nigeria
okr.region.country
Sri Lanka
okr.topic
Private Sector Development :: Microenterprises
okr.topic
Private Sector Development :: Organizational Management
okr.topic
Private Sector Development :: Small and Medium Size Enterprises
okr.topic
Social Protections and Labor :: Skills Development and Labor Force Training
okr.unit
Finance and Private Sector Development Team, Development Research Group

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