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SKEMA Publika: why don’t all businesses play by the same rules?
In a new policy paper published by SKEMA Publika, Victor Motta, Professor of Economics at SKEMA Business School’s Belo Horizonte campus and member of the SKEMA Centre for Sustainability Studies, examines the persistent gaps between small and large companies across developing economies. Access to finance, innovation, recruitment and exports: the study highlights how uneven business development conditions remain from one company to another.
Why do some businesses innovate, export and hire while others struggle to grow? In a new policy paper published by SKEMA Publika, Victor Motta explores the deep disparities shaping the private sector across emerging and developing countries.
Drawing on World Bank data, the economist compares the conditions under which companies operate depending on their size, industry and region of the world.
The first finding is clear: large companies tend to enjoy better access to financing, invest more in training, innovate more easily and export more. Smaller firms, by contrast, remain more exposed to financing difficulties, skills shortages and competition from the informal economy.
International reach drives innovation
“Economic policies often treat businesses as a homogeneous group, despite the fact that they face very different constraints,” the paper notes.
The study also shows that companies with a stronger international presence tend to be the most innovative, benefiting from improved access to technologies and skills. Another key finding concerns employee training: large firms are far more likely to implement structured upskilling programmes than smaller businesses. The paper also examines female leadership, revealing major differences depending on sectors and regions of the world.
Against this backdrop, Victor Motta calls for more targeted public policies, including:
- streamlined administrative procedures,
- easier access to financing,
- stronger support for SMEs,
- greater investment in skills,
- and measures to combat the informal economy.
