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Bigger and Better: Beyond Micro and Fair Trade by Mats Tunehag and Peter Heslam

We know that aid does not lift people and nations out of poverty. We also know that micro credit programs are limited in their effect. They tend to increase the informal sector. In contrast small and medium size companies are the back bone of developed countries. They create socio-economic changes which drive democratization and these enterprises also are an essential tax base for nations.

Dr Peter Heslam at Cambridge University has written a helpful two page article on entrepreneurship and the importance of small and medium-sized enterprises. Excerpts:

“Entrepreneurship represents the best antidote to poverty. While the development community, focused primarily on aid, debt relief and the reform of global institutions, shows signs of accepting this, their interest is generally restricted to microcredit, fair trade, social enterprise, corporate philanthropy and Corporate Social Responsibility (CSR).
Micro enterprise can indeed help poor people achieve subsistence, provide for their families and secure them against abject poverty; fair trade can bring benefits to certain producer groups; social enterprise can make community projects more sustainable; and corporate philanthropy or CSR initiatives can help multinationals (MNCs) increase their pro-poor impact.

Of much greater long-term significance, however, are core activities of mainstream commercial enterprise. Key here are small and medium-sized enterprises, which are the world’s foremost creators of jobs, wealth and opportunity, making healthy contributions to gross domestic product in many of the developing economies that are growing.”

Dr Peter Heslam is Director of Transforming Business, Cambridge University in the UK. Click here for Dr Heslam's article

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posted by Justin Forman | 2.25.2009 - 9:07 PM

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