The development of micro- and small enterprises (MSEs) can play an essential role in employment creation and poverty reduction. Many governments in developing countries have made efforts to support MSEs for just this reason. At the same time, millions of people work in MSEs where they are paid low incomes, have little or no social protection and are exposed to dangerous working conditions. This paradox stems from a policy and regulatory environment that should help the development of MSEs and improve the quality of jobs provided by them, but in practice often establishes biases and stifles growth.
This book looks beyond MSE promotion initiatives to analyse the overall policy and regulatory environment in which MSEs work. Based on studies carried out in Chile, Guinea, Pakistan, Peru, South Africa, the United Republic of Tanzania and Viet Nam, it examines national business laws, taxation, labour regulations, and trade and finance policies, and assesses their direct and indirect effects on the MSE sector. Drawing lessons from this research, the authors outline the major principles for reform, including the importance of communication and transparency, and the designing of laws and regulations that are country specific, fair and take account of existing gender-based inequalities. More than simply helping to create more jobs, this approach aims to help to create more jobs of better quality.
The findings presented here have potential for application far beyond the seven countries studied and deserve the attention of policy-makers, development practitioners and researchers everywhere.
Key features:
- Explains why the policy environment matters for MSE employment creation
- Provides numerous examples of best practice to unleash the employment potential of MSEs
- Offers valuable guidance on assessing the policy and legal environment
- Identifies common problems and presents major principles for reform
- Based on studies carried out in a diverse group of countries - Chile, Guinea, Pakistan, Peru, South Africa, Tanzania and Vietnam