The impact of important economic factors on the quality of business environment in the SME sector

Abstract

A high-quality business environment shapes a country's economic system in a significant way, motivates people to start a business, and creates favorable conditions for remaining on the market and for the growth of small and medium-sized enterprises (SMEs). The aim of this paper is to define important economic factors influencing the quality of the business environment and their impact on the economic system. In regards to this aim, an empirical research was conducted in 2018, using a survey in the SME sector in the Czech and the Slovak Republic. These countries, given their common history, share a very similar economic structure and development. The research was done on a sample of 641 respondents. They were business owners and managers active in small and medium-sized enterprises. As a part of the research, important factors were defined in the following areas: macroeconomics, currency policy and interest rates, SME financing and population consumption. The respondents had the option to express their agreement using the Likert scale: strongly agree, agree, neutral, disagree and strongly disagree. The results of the research were processed via the method of regression analysis. It was discovered that the defined economic factors significantly influence the perception of the quality of the SMEs' business environment. A positive perception of the state of the macroeconomic environment motivates people to start a business. Entrepreneurs in both countries rated the current state of the macroeconomic environment as favorable and supportive of their entrepreneurial activities. They also confirmed that the current situation supports the enterprises' innovation activities. Based on the respondents' statements, the current level of basic macroeconomic parameters, such as the gross domestic product, employment, and inflation, supports entrepreneurship and creates interesting business opportunities in the SME sector. Similarly, the Central bank currency policy stabilizes the business environment in both countries. The research yielded a finding that in the current economic situation, small and medium-sized enterprises have a good access to bank loans. On the contrary, economic factors such as population consumption, changes in income and the structure of consumer spending are not statistically important factors that could influence the quality of the SMEs' business environment in the Czech and the Slovak Republic. © 2018 Proceedings of the European Conference on Innovation and Entrepreneurship, ECIE. All rights reserved.