Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/298161 
Year of Publication: 
2024
Series/Report no.: 
ADB Economics Working Paper Series No. 715
Publisher: 
Asian Development Bank (ADB), Manila
Abstract: 
Limited data on micro, small, and medium-sized enterprises (MSMEs) make it difficult for governments to design appropriate MSME policies in Asia and the Pacific. To identify factors affecting MSME development and promote evidence-based policymaking, we propose a probabilistic principal component analysis method that works despite current data limitations. The study uses time-series MSME data collected from 25 developing member countries of the Asian Development Bank (ADB) through the Asia Small and Medium-Sized Enterprise Monitor project. The estimation results suggest that sound MSME credit markets, diversified financing options, support for new businesses and job creation, and active MSME participation in global marketplaces play a critical role in ensuring a smooth business recovery from various crises and shocks affecting developing Asia and the Pacific.
Subjects: 
SME development
access to finance
financial inclusion
SME policy
probabilistic principal component analysis
Southeast Asia
South Asia
Central and West Asia
the Pacific
JEL: 
D22
G20
L20
L50
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Working Paper

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