Abstract
This study aims to investigate the socioeconomic determinant factors that affect the growth of micro and small enterprises (MSEs) in North Wollo and Waghimira Zone selected towns. In this study, a cross-sectional research design with both descriptive and explanatory research design has been employed, and 303 owners of enterprises have participated. The towns were selected purposely, and the respondents were also selected by using a simple random sampling technique. The data were analyzed by using STATA v-14 and applied descriptive and binary logistic regression analysis (odds ratio). The finding of the study revealed that age of the owner, access to finance, family business background, and interest rate most likely affect the growth of the enterprises with the statistically significant level. On the contrary, entrepreneurship training, the experience of the owner, the inflation rate, and competition less likely affect the growth of the enterprises with a statistical significant level. The remaining factors such as gender of the owners, education background, business age, business type, business location, social responsibility, tax rate, and social attitude were not statistically significant to determine the growth of MSEs.
Highlights
Micro and small enterprises (MSEs) are the best solutions for the country’s gross domestic development, reduction of unemployment, and creating smooth economic environments
In South Africa, the enterprises became a bounce of economic growth and expansions and contribute 50% of employment opportunity and the gross domestic product of other African countries (Kamunge et al, 2014)
The remaining variables sex, education background of the owners, business age, business type, business location, social responsibility, tax rate, and social attitude have not been statistically significant to affect the growth of MSEs
Summary
Micro and small enterprises (MSEs) are the best solutions for the country’s gross domestic development, reduction of unemployment, and creating smooth economic environments. In fast-growing countries, MSEs create more jobs for young graduates, because these enterprises do not require, space/size, training, capital, and sophisticated technologies (Saleem, 2017). In South Africa, the enterprises became a bounce of economic growth and expansions and contribute 50% of employment opportunity and the gross domestic product of other African countries (Kamunge et al, 2014). In Romania, these enterprises comprise 50% by adding value to the economy of the country (Cicea et al, 2019). The governments incorporate the issues of micro and small enterprises in their policies to get more shares for their country's economy.
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