SMEs innovation and growth in EU

Veselinova, Elena and Gogova Samonikov, Marija (2012) SMEs innovation and growth in EU. Management Journal for Theory and Practice Management (64). pp. 87-94. ISSN 1820-0222


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The focus of this paper is the analysis of the most important factors for SMEs’ performance, survival and growth in EU. The main objective is to consider what determines the potential failure of young companies to innovate and grow.The importance for new, young and thus often still small firms to introduce innovations and grow is commonly claimed. Therefore, factors that would inhibit these small, young companies to achieve their goals can have a huge public impact.The research results show that the age of the firm (which reflects its reputation) is important to the degree to which the firm feels financially constrained. Also, finance barriers can be associated with the market failure. Risk and informational asymmetries create capital market imperfections and a firm’s lack of reputation and collateral become crucial elements. Conclusions reveal that the ability of SMEs to grow depends highly on their potential to invest in restructuring, innovation and qualification. All of these investments require capital and therefore access to finance. Recent policy initiatives aim at improving the financial environment for European entrepreneurial activity and, more specifically, at supporting newly-founded innovative firms in order to increase their global competitiveness and spur innovation. Keywords: SMEs, financing, innovation, growth.

Item Type: Article
Subjects: Social Sciences > Economics and business
Divisions: Faculty of Economics
Depositing User: Elena Veselinova
Date Deposited: 24 Jan 2013 15:00
Last Modified: 19 Aug 2014 08:13

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