Are regulatory interventions seen as an obstacle or an enabler to SME performance and growth in transition economies: a study of gendered perceptions?
Objectives The aim of this paper is to empirically test the influence of the perceived regulatory burden in the context of postcommunist economies on SME performance and growth from a gender perspective. Prior Work The research literature largely argues that regulation is a burden, cost or constraint for SMEs, although recent work suggests regulation has a dual influence, enabling as well as constraining firms. These conflicting influences play out variably for particular firms. Most studies focus on mature market economies where regulatory frameworks are well-established. In this paper we attempt to study the impact of regulation on small enterprises within the context of transition economies from a gender perspective. Approach Using a panel firm-level dataset from the Business Environment and Enterprise Performance survey (BEEPS) of 27 countries in Central and Eastern Europe and Central Asia for 2005-2009, we study whether perceptions of regulatory interventions (tax, licencing and permits, court system, customs, inspections and labour regulations) are seen as obstacles or enablers by firms and whether perceptions differ by gender. We perform difference-in-means tests on various perception and “de facto” indicators of the regulatory environment and estimate a quartile regression model on the pooled-crossed section and the panel data to investigate the influence of dealing with governmental regulations on business performance. To control for reverse-causality, we merge firm-level perceptions with country-level indicators and financial parameters for similar interventions. Results Our preliminary findings from empirical testing suggest that there is variability in regulatory impacts by gender of business owner, firm size and firm age and ownership type. A more nuanced analysis suggests that business regulation enables growth for male-owned firms; while for female owned firms regulatory interventions are more of an obstacle. Implications Failure to understand how regulation affects business performance of female and male owned firms means that policy interventions are likely to produce unwanted consequences because neither the full range of mechanisms shaping small-business performance nor the conditions which support or hinder the exercise of these mechanisms are fully identified. Value Overall, this study seeks to contribute to existing research in the field of gender and entrepreneurship by examining the influence of regulatory burden in the context of post-communist economies rarely studied in the literature, using quantitative techniques that allow generalisation to population of entrepreneurs in transition countries.
in partnership with Kingston University and Queensland University of Technology
Citation : Vershinina, N., Rodionova, Y., Kitching, J. and Barrett, R. (2014) Are regulatory interventions seen as an obstacle or an enabler to SME performance and growth in transition economies: a study of gendered perceptions? ISBE Conference 2014, Manchester, UK
Research Group : Centre for Research in Ethnic Minority Entrepreneurship
Peer Reviewed : Yes