Abstract
Although the European business environment induces important premises and assures conditions in determining economic growth and social well-being, the determinant and existent connections between the evolution of small and medium-sized enterprises (SMEs), business demography characteristics and the European socio-economic model have been scarcely studied in recent years. The dimensions of the European socio-economic model design a very specific framework in developing business demography and assuring a favorable environment for future SME development. The main aim of the manuscript is to investigate the evolution of the European SMEs sector and the perspective of business demography evolution to converge with exigencies of the European socio-economic model. In order to argue the research objective, eight specific and representative business demography variables were employed, from 12 European Union member states (EU-MS), during 2009–2017. Further, the SMEs’ performances, determined by changing the economic functional paradigm, were assessed. For proving this, an econometric model was designed considering labor productivity as an endogenous variable. Our preliminary analysis shows considerable differences in business demography indicators and SMEs development among all five socio-economic sub-models of the main European socio-economic model, proving a tight connection between European socio-economic models and SMEs’ performance and arguing the necessity of a paradigm convergence. Within some sub-models, there is clear evidence of clustering and convergence in terms of business demography and SMEs future development.
Highlights
Considering a dataset of eight representative business demography variables, operating in 12 European Union (EU) countries over a period of eight years, we find that business demography developments and national economic dimensions have a statistically significant impact on converging to a specific economic performance
Given that the differences in economic performance between European countries increased in the 1990s, especially in terms of production dynamics, productivity and employment, most of these scientific contributions examine differences in performance between European countries, seeking to identify the factors growth and key areas for adaptability to present and future challenges
The main contribution of the paper is the analysis on the evolution, concentration, framing and assessment of belonging of a country or group of countries to an economic model already defined in the literature, from the perspective of small and medium-sized enterprises (SMEs) specific indicators and their influence on labor productivity
Summary
Our approach is dedicated to investigating the evolution of the European small and medium-sized enterprises (SMEs) sector and the perspective of business demography evolution to converge with exigencies of the European socio-economic model. From this perspective, the aim is to evaluate the response of the contemporary economies to numerous risks and challenges they are facing on their way to assuring growth and well-being for their populations. The big challenge of this research was to correlate the evolution of SME business demography during the analyzed period with the specificity characteristics of one of the European socio-economic model variants and integrate them in the econometric model
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