Theme
Jobs and Economic Growth

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With over 10 years of active involvement and experience, ANDE is committed to further deepening our role in the entrepreneurship and development ecosystem. Our updated global strategy, which informs ANDE’s global and regional work for the coming years, aligns with the United Nations’ Sustainable Devel­opment Goals (SDGs), specifically focusing efforts on three urgent issues: decent work and economic growth, gender equality, and climate and environmental action. This brief focuses on decent work and economic growth, for India. It has been developed in partnership with ANDE Members Upaya Social Ventures and Global Alliance for Mass Entrepreneurship (GAME). The brief highlights the current status quo of how small & growing businesses are contributing to creation of decent jobs and outlines strategies for collaborative action to strengthen the ecosystem.

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Based on a review of existing literature, this paper discusses to what extent and how SMEs can
deliver green and inclusive growth. The OECD defines green growth as aligning economic growth and environmental objectives. Specifically, it involves transitioning to a resource-efficient, low carbon economy and preserving environmental resources while seizing the economic opportunities that this transition generates (OECD, 2015[9]). Similarly, the World Bank defines green growth as “economic growth that is environmental sustainable.” Put it more concretely, it means “enabling developing countries to achieve robust growth without locking themselves into unsustainable patterns” (World Bank, 2012[10]). Meanwhile, inclusive growth involves raising “societies’ welfare or living standards broadly defined.” It is a multidimensional measure of growth and includes both income-related measures of well-being and non-income elements such as health and education. Inclusive growth also emphasizes the question of distribution; that is, how are aggregate changes in measures of growth distributed across households and individuals (Boarini, Murtin and Schreyer, 2015[11])? Simply, green and inclusive growth involves a transition to an eco-friendly, low-carbon economy and simultaneously, broad improvements in societal welfare. Thus, the paper is concerned with discussing to what extent greening SMEs delivers widespread societal welfare gains."

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"Salaried wage jobs are the distinguishing feature separating the middle class from the poor in
developing countries (Banerjee and Duflo 2008). Where do salaried wage jobs come from, and
how can small and medium-sized firms create more of them? We review the evidence on
constraints to growth of small and medium enterprises. We first examine evidence on
constraints to capital and skilled labor, firms’ primary inputs to production. We then consider
factors that affect the efficiency with which firms are able to transform inputs into outputs,
focusing on managerial talent. Finally, we look at the importance of linking firms to markets
and the role of demand in generating firm growth. We conclude with a proposal for a research
agenda built around important but unanswered questions. "

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"Today India, and the world, finds itself in the unenvious position of enduring two major economic recessions in a span of 10-12 years, unprecedented in modern history. In the aftermath of COVID-19, which has hit the small enterprise sector the hardest, where a majority of women-led ventures are recorded, it has become imperative to actively find avenues to encourage sustainable growth. This report delves deep into the various factors and circumstances inhibiting the growth of women-led enterprises, and further explores how women entrepreneurship can be encouraged while also being a force of change. Through various articles mentioned in this collection, which are based on original research studies conducted in this area during the pandemic, we seek to provide a snapshot of the existing obstacles, but also the way forward in promoting women entrepreneurship, which can be a major contributor in the socio-economic recovery of India."

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"In collaboration with Google, this report presents four opportunities for unlocking the potential of female entrepreneurship in India: 1) Level the playing field for the high-impact, employment-creating entrepreneurs; 2) Enable ambitious “solopreneurs” and small business owners to scale and become high-impact entrepreneurs; 3) Encourage more women to start enterprises; 4) Build, strengthen and scale productive rural “agripreneurs.”

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"This paper investigates the contribution of small firms to employment, job creation, and growth in developing countries. While small firms (< 20 employees) have the smallest share of aggregate employment, the small and medium enterprise sector's (< 100 employees) contribution is comparable to that of large firms. Small firms have the largest shares of job creation, and highest sales growth and employment growth, even after controlling for firm age. Large firms, however, have higher productivity growth. Conditional on size, young firms are the fastest growing and large mature firms have the largest employment shares but small young firms have higher job creation rates."

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"Recent research shows that start-ups are important for job creation, but these firms are also inherently volatile. We use linked employer-employee data to examine the relative importance of firm age and firm size for job creation and destruction in Brazil. Firm age is a more important determinant of job creation in Brazil than firm size; young firms and star-ups create a relatively high number of jobs. However, young firms are also more likely to exit the market and have higher levels of employment volatility. We, therefore, condition the job creation analysis on job stability. Young firms and large firms create relatively more stable jobs in Brazil."

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"This report unpacks why women's entrepreneurship is good for business and is essential for economic growth. Small to medium-sized enterprises (SMEs) are a key driver of economic growth, and women-owned enterprises account for approximately 30-37 percent (8-10 million) of all SMEs in emerging markets. As such, women are the fastest-growing market segment, they start businesses at a higher rate than men, and it is expected that they will create approximately 50 percent of new small business jobs by 2018. In developing economies, SMEs are increasingly important, as they contribute to nearly half of the labor force."

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"Working with five Ethiopian firms, we randomized applicants to an industrial job offer, an "entrepreneurship" program of $300 plus business training, or control status. Industrial jobs offered more and steadier hours but low wages and risky conditions. The job offer doubled exposure to industrial work but, since most quit within months, had no impact on employment or income after a year. Applicants largely took industrial work to cope with adverse shocks. This exposure, meanwhile, significantly increased health problems. The entrepreneurship program raised earnings 33 percent and provided steadier hours. When barriers to self-employment were relieved, applicants preferred entrepreneurial to industrial labor."

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"This publication identifies synergies between the DCED Standard for Results Measurement (the Standard) and the Global Impact Investing Network's IRIS+ system, which builds on the IRIS metrics catalogue and the Navigating Impact Project...The DCED Standard for Results Measurement (Standard) is a framework that helps organisations and programmes manage for impact...The IRIS+ system helps investors measure the social, environmental and financial performance of an investment and IRIS+ combines impact investing's most widely used impact performance metrics with research, evidence, and practical implementation guidance into a single comprehensive system."

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