Effect of Regional Economic Development on Small and Medium-Sized Enterprises: Modern Concept of the Dependency

Abstract

Small and medium enterprises (SMEs) play an important role in regional economic development. However, the results of their activities largely depend on the regional factors. The article provides an overview of the most influential and latest publications on the relationship between SMEs and regional development processes. The impact of SMEs on the growth of the regional economy proved to be assessed ambiguously. A direct positive impact is typical for high-income countries, while other countries yield mixed results. High-income countries have factors and support mechanisms that overcome the objective limitations of SMEs. In the Russian regions, SMEs perform their functions to a lower extent and, as a result, have low factor productivity, which limits their contribution to the regional economy. No unified idea of SME differentiation factors was detected in domestic and foreign publications. Abroad, a higher level of SME development is usually associated with such obvious factors as population, the size of the regional economy, availability of financing, etc. The review of domestic literature revealed some data on the differentiation of regions according to the state and SME characteristics, but no patterns that would determine these features. The review highlighted some issues for further research of the relationship between SMEs and the regional economy. The results obtained can be used to develop regional SMEs and specialized university courses.