Abstract
The aim of this article is to define important factors which determine the quality of the business environment and construct a structural model of causal relationships between quality of business environment and its determinants in small and medium sized enterprises. This model was constructed on the basis of extensive empirical research. A questionnaire was designed and delivered to SMEs operating in the Czech and Slovak Republics. The sample consists of 641 enterprises from both countries. Data were evaluated using statistical methods such as confirmation factor analysis and structural equation modeling. The structural model showed very interesting findings. The most important factors, which determine the quality of business environment are macroeconomic environment, monetary policy and interest rates and legal environment. In our model, we also pointed out the importance of political, social and technological factors. The research results pointed to the need to adjust the legislative environment in a more appropriate way, to minimize state bureaucracy and to improve media access to business environment assessment. These results are useful for the academic researchers in the area of entrepreneurship, policymakers, and non-profit institutions and organizations whose effort is to improve the business environment and boost entrepreneurship.
Highlights
Improving the quality of small and medium sized enterprises (SMEs) business environment is a major challenge for the European Union countries with an economic, political, technological and social dimensions
Improving the Quality of Business Environment (QBE) and business climate in general can be seen as a constant concern of policymakers who design policies/strategies aimed at fostering entrepreneurship and boosting economic activity (Ohotina et al, 2018; Mackevicius et al, 2018; Cera et al, 2019)
These results are identical to the scree graph, which confirmed 19 factors, as the Kaiser rule achieved exactly 19 components, which we subsequently labelled as factors
Summary
Improving the quality of small and medium sized enterprises (SMEs) business environment is a major challenge for the European Union countries with an economic, political, technological and social dimensions. It is a logical approach, following the long-term interest in SME development of the relevant authorities in the European Union, and in national economies across Europe. Improving the QBE and business climate in general can be seen as a constant concern of policymakers who design policies/strategies aimed at fostering entrepreneurship and boosting economic activity (Ohotina et al, 2018; Mackevicius et al, 2018; Cera et al, 2019)
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