Evaluation of economic potential of business environment development by comparing sector differences: perspective of SMEs in the Czech Republic and Slovakia
Keywords:business environment, business risks, business support, correspondence analysis, sector analysis
Research background: Improving business conditions and SME development are signs of a country?s macroeconomic stability. The issue of identifying and removing barriers to the development of firms in the SME segment is a priority in all countries with developed economies and its importance is currently increasing.
Purpose of the article: The main aim of this paper is to explore possible differences in entrepreneurs? perception of the business environment based on the industry in which the company operates. The analysis contains also a national view, where a comparison between the Czech Republic and the Slovak Republic is performed.
Methods: Correspondence analysis was used to achieve the research objectives in order to examine the relations between the categorical variables. Its application is beneficial in cases where the graphic output is clearer than the numerical one.
Findings & Value added: The presented research makes it possible to identify problematic aspects of doing business in each sector and to create support mechanisms for the creation of effective structural policies. Entrepreneurs from the Czech Republic?s Production and Transport sectors agree with the statement that the business environment in the country is suitable for starting a business. As for business environment?s suitability for doing business, neither Slovak nor Czech entrepreneurs sector-wide agreed with the given statement. Czech entrepreneurs from the Services, Trade and Construction sectors, respectively, agree, fully agree with the statement that the business environment in the country is reasonably risky and allows for doing business. In the case of entrepreneurs from Slovakia, no significant correspondence is observed. Findings regarding the statement that the business conditions in the country have improved over the past five years are the following: In the Czech Republic, there is a perfect correspondence of the Transport sector and the agreement with the given statement. In the Slovak Republic, agreement was found with the given statement in the Transport sector and neutral position in the Production sector.
Berger, A. N., & Udell, G. F. (2006). A more complete conceptual framework for SME finance. Journal of Banking & Finance, 30(11). doi: 10.1016/j.jbankfin .2006.05.008.
Belás, J., Dvorský, J., Tyll, L., & Zvaríková, K. (2017). Entrepreneurship of University Students: Important Factors and the Propensity for Entrepreneurship. Administratie si Management Public, 28.
Belás, J., Nguyen, A., Smrčka, L., Kolembus, J., & Cipovová, E. (2016). Financial literacy of secondary school students. Case study from the Czech Republic and Slovakia. Economics and Sociology, 9(4). doi: 10.14254/2071- 789X.2016/9-4/12.
Blajer-Gołębiewska, A., Wach, D., & Kos, M. (2018). Financial risk information avoidance. Economic Research-Ekonomska Istraživanja, 31(1). doi: 10.1080/ 1331677X.2018.1439396.
Borg, I., & Groenen, P. J. F. (2010). Modern multidimensional scaling: theory and applications. New York, NY: Springer Science + Business Media.
Greenacre, M. J. (1984). Theory and applications of correspondence analysis. London: Academic Press.
Bruns, V., & Fletcher, M. (2008). Banks' risk assessment of Swedish SMEs. Venture Capital, 10(2). doi:10.1080/13691060801946089.
Caplinska, A., & Ohotina, A. (2019). Analysis of financial literacy tendencies with young people. Entrepreneurship and Sustainability Issues, 6(4). doi: 10.9770/ jesi.2019.6.4(13).
Corazza, M., Funari, S., & Gusso, R. (2016). Creditworthiness evaluation of Italian SMEs at the beginning of the 2007–2008 crisis: an MCDA approach. North American Journal of Economics and Finance, 38. doi: 10.1016/j.najef. 2016.05.008.
Cepel, M., Stasiukynas, A., Kotaskova, A., & Dvorsky, J. (2018). Business environment quality index in the SME segment. Journal of Competitiveness, 10(1). doi: 10.7441/joc.2018.02.02.
Dallago, B. (2014). The role of universities in local development. Corvinus Journal of Sociology and Social Policy, 5. doi: 10.14267/cjssp.2014.01.02.
Eggers, F., Kraus, S., Hughes, M., Laraway, S., & Snycerski, S. (2013). Implications of customer and entrepreneurial orientations for SME growth. Management Decision, 5. doi: 10.1108/00251741311309643.
Fairlie, R. W., & Holleran, W. (2012). Entrepreneurship training, risk aversion and other personality traits: evidence from a random experiment. Journal of Economic Psychology, 33(2). doi: 10.1016/j.joep.2011.02.001.
Fredriksson, A., & Moro, A. (2014). Bank–SMEs relationships and banks’ risk-adjusted profitability. Journal of Banking & Finance, 41. doi: 10.1016/j. jbankfin.2013.12.026.
Gavurova, B., Vagasova, T., & Kovac, V. (2016). Competitiveness assessment of Slovak Republic regions. In J. Krajicek, J. Nesleha & K. Urbanovsky. In European financial system 2016: proceedings of the 13th international scientific conference. Brno: Masaryk University.
Gavurova, B., Huculova, E., Kubak, M., & Cepel, M. (2017). The state of student’s financial literacy in selected Slovak universities and its relationship with active pension savings. Economics & Sociology, 10(3). doi: 10.14254/2071-789x. 2017/10-3/15.
Gluchman, V., & Gluchmanová, M. (2018). Students’ views on ethical issues in Slovak education. Journal of Educational Sciences and Psychology, 8(1).
Ghulam, Y. (2019). SME’s credit conditions during the financial crisis in Europe. Prague Economic Papers, 28(1). doi: 10.18267/j.pep.672.
Grzybek, G., & Malczyńska-Biały, M. (2019). The ethical dimension of consumption in a relationship. Ethics & Bioethics (in Central Europe), 9. doi: 10.2478/ebce-2019-0004.
Hanafi, N., Yunus J. M., Azmi R., & Othman F. M. (2018). Learning orientation entrepreneurial orientation and legal issues on women-owned SMSs’ performance. European Proceedings of Social & Behavioural Sciences, 52. doi: 10.15405/epsbs.2018.12.03.87.
Hudakova, M., Masar, M., Luskova, M., & Patak, M. R. (2018). The dependence of perceived business risks on the size of SMEs. Journal of Competitiveness, 10(4). doi: 10. 10.7441/joc.2018.04.04.
Ivanová, E., & Čepel, M. (2018). The impact of innovation performance on the competitiveness of the Visegrad 4 Countries. Journal of Competitiveness, 10. doi: 10.7441/joc.2018.01.04.
Jayaraman, J. D., & Jambunathan, S. (2018). Financial literacy among high school students: evidence from India. Citizenship. Social and Economics Education, 17. doi: 10.1177/2047173418809712.
Polishchuk, V., Kelemen, M., Gavurova, B., Varotsos, C., Andoga, R., Gera, M., Christodoulakis, J., Soušek, R., Kozuba, J., Blišťan, P., & Szabo, S. (2020). A fuzzy model of risk assessment for environmental start-up projects in the air transport sector. International Journal of Environmental Research and Public Health, 16(23). doi: 10.3390/ijerph16193573.
Kelemen, M., Polishchuk, V., Gavurova, B., Szabo, S., Rozenberg, R., Gera, M., Kozuba, J., Andoga, R., Divokova, A., & Blišťan, P. (2020). Fuzzy model for quantitative assessment of environmental start-up projects in air transport. International Journal of Environmental Research and Public Health, 16(24). doi: 10.3390/ijerph16193585.
Ključnikov, A., Kozubíková, L., & Sopková, G. (2017). The payment discipline of small and medium-sized enterprises. Journal of Competitiveness, 9(2). doi: 10.7441/joc.2017.02.04.
Ključnikov, A. (2016). Uncover SMEs finance through the impact of the specific factors. Evidence from Slovakia. Transformations in Business & Economics, 15(2B).
Li, K., Niskanen, J., Kolehmainen, M., & Niskanen, M. (2016). Financial innovation: credit default hybrid model for SME lending, 61(C) Expert Systems with Applications. doi: 61. 10.1016/j.eswa.2016.05.029.
Mura, L., Marchevska, M., & Dubravska, M. (2018). Slovak retail business across panel regression model. Marketing and Management of Innovations, 4. doi: 4. 10.21272/mmi.2018.4-18.
Mura, L. (2019). Entrepreneurship internationalization – case of Slovak family businesses. AD ALTA-Journal of Interdisciplinary Research, 9.
Naushad, M. (2018). A study on the antecedents of entrepreneurial intentions among Saudi students. Entrepreneurship and Sustainability Issues, 5(3). doi: 10.9770/jesi.2018.5.3(14).
Nguyen, T. A. N., & Rozsa, Z. (2019). Financial literacy and financial advice seeking for retirement investment choice. Journal of Competitiveness, 11. doi: 10.7441/joc.2019.01.05.
Nikolic, N., Jovanovic, I., Nikolic, D., Mihajlovic, I., Schulte, P. (2019). Investigation of the factors influencing SME failure as a function of its prevention and fast recovery after failure. Entrepreneurship Research Journal, 9. doi: 10.1515/erj-2017-0030.
Oláh, J., Virglerova, Z., Popp, J., Kliestikova, J., & Kovács, S. (2019). The assessment of non-financial risk sources of SMES in the V4 countries and Serbia. Sustainability, 11. doi: 10.3390/su11174806.
Pérez-Gómez, P., Arbelo-Pérez, M., & Arbelo, A. (2018). Profit efficiency and its determinants in small and medium-sized enterprises in Spain. BRQ Business Research Quarterly, 21. doi: 10.1016/j.brq.2018.08.003.
Rahman, A., Belas, J., Kliestik, T., Tyll, L. (2017). Collateral requirements for SME loans: empirical evidence from the Visegrad countries. Journal of Business Economics and Management, 17(4). doi: 10.3846/16111699.2017. 1357050.
Remeikiene, R., Rozsa, Z., Ligita, G., & Penčik, J. (2018). Assessment of the impact of the international trade in agricultural products on the EU economic growth. E&M Economics and Management, 21. doi: 10.15240/tul/001/2018-4-003.
Ryan, R. M., O’Toole, C. M., & McCann, F. (2014). Does bank market power affect SME financing constraints? Journal of Banking & Finance, 49. doi: 10.1016/j.jbankfin.2013.12.024.
Salimi, N., & Rezaei, J. (2018). Evaluating firms’ R&D performance using best worst method. Evaluation and Program Planning, 66. doi: 10.1016/j. evalprogplan.2017.10.002.
Wang, Y. (2016). What are the biggest obstacles to growth of SMEs in developing countries? – an empirical evidence from an enterprise survey. Borsa Istanbul Review, 16. doi: 16. 10.1016/j.bir.2016.06.001