Evaluating SME Support Programs in Chile Using Panel Firm Data

Evaluating SME Support Programs in Chile Using Panel Firm Data

This paper evaluates small and medium enterprise (SME) support programs in Chile using a firm-level panel for the 1992-2006 period on two groups of firms a treatment group that participated in SME programs and a control group that did not. These...

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Bibliographic Details
Main Author:	Tan, Hong
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	ACCOUNTING BENEFICIARIES BUSINESS DEVELOPMENT BUSINESS DEVELOPMENT SERVICES BUSINESS ENVIRONMENT CONSUMER PRICE INDEX CONTROL GROUPS COUNTERFACTUAL CREDIT LINES ECONOMIC SECTORS EMPLOYMENT EMPLOYMENT GROWTH ENTERPRISE SUPPORT EVALUATION METHODS EVALUATION RESULTS EVALUATORS FIRM SIZE FIRM SIZES FIRMS FOREIGN PARTNERS IMPACT EVALUATION IMPERFECT INFORMATION INCOME INDUSTRIAL ENTERPRISES INDUSTRY ASSOCIATION INFORMATION SYSTEMS INNOVATION INNOVATIONS INTERMEDIATE OUTCOMES INTERNATIONAL MARKETS JOB CREATION LABOR PRODUCTIVITY LOAN MANUFACTURING ESTABLISHMENTS MARKET FAILURES MATCHING METHODS MEDIUM ENTERPRISE MEDIUM ENTERPRISES NEGOTIATION OUTCOME INDICATORS OUTPUTS PARTY POVERTY REDUCTION PRODUCTION PROCESS PRODUCTIVITY GROWTH PROGRAM IMPACTS PROGRAM INTERVENTIONS PROGRAM OUTCOMES PROGRAMS PROPENSITY SCORE MATCHING PTI RESEARCH CENTERS SAMPLE SIZE SEES SIMULATIONS SKILLED WORKERS SMALL BUSINESSES SMALL ENTERPRISES SMALL FIRMS SME SME SUPPORT PROGRAMS SOCIAL DEVELOPMENT SUPPLIER SUPPLIERS TARGETING TECHNICAL ASSISTANCE TECHNOLOGY TRANSFER TRAINING ACTIVITIES TRAINING INSTITUTES TRAINING PROGRAMS TREATMENT EFFECTS TREATMENT GROUPS UNSKILLED WORKERS WAGES WORKING CAPITAL
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091020140405 http://hdl.handle.net/10986/4274

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Summary:	This paper evaluates small and medium enterprise (SME) support programs in Chile using a firm-level panel for the 1992-2006 period on two groups of firms a treatment group that participated in SME programs and a control group that did not. These unique panel data provide an unprecedented opportunity to address several issues that have plagued impact evaluations of SME programs selectivity bias from observed and unobserved firm heterogeneity, identification of an appropriate control group, and inability to track firms over a long enough period of time for performance outcomes to be realized. Using difference-in-differences models combined with propensity score matching methods, the paper finds evidence that participation in SME programs in Chile is associated with improvements in intermediate outcomes (training, adoption of new technology and organizational practices), and causally with positive and statistically significant impacts on sales, production, labor productivity, wages and exports. The mixed results of previous studies may be attributable in part to the confounding effects of unobserved heterogeneity motivating selection into programs of firms with relatively low productivity levels, and in part to time-effects of program participation occurring in years after the time horizon of most impact evaluation studies.