SMEs in Developing Asia: New Approaches to Overcoming Market Failures

Abstract

A vibrant stratum of small and medium-sized enterprises (SMEs) is critical for the growth and development of Asian economies. These enterprises generate employment, contribute to investment, participate in value chains, and support innovation. SMEs that seek to sustain and grow their operations, however, face a variety of constraints, many of which are directly related to size. These “size-induced market failures” create a role for public policy intervention. This book focuses on the market failures encountered by enterprises in the key areas of technology and innovation, credit and finance, education and skills, and market access. Obstacles to SME participation in the rapidly expanding regional and global value chains are also examined. The chapter authors examine national and multicountry experiences in South, East, and Southeast Asia.