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Journal cover: Journal of Chinese Entrepreneurship

Journal of Chinese Entrepreneurship

ISSN: 1756-1396
Currently published as: Journal of Entrepreneurship in Emerging Economies

Online from: 2009

Subject Area: Enterprise and Innovation

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State promotion of SME development at the local level in China: An examination of two cases

Document Information:
Title:State promotion of SME development at the local level in China: An examination of two cases
Author(s):Andrew Atherton, (Enterprise Research and Development Unit (ERDU), University of Lincoln, Lincoln, UK), David Smallbone, (Small Business Research Centre, Kingston University, Kingston upon Thames, UK)
Citation:Andrew Atherton, David Smallbone, (2010) "State promotion of SME development at the local level in China: An examination of two cases", Journal of Chinese Entrepreneurship, Vol. 2 Iss: 3, pp.225 - 241
Keywords:China, Entrepreneurialism, Private sector organizations, Small- to medium-sized enterprises
Article type:Research paper
DOI:10.1108/17561391011078721 (Permanent URL)
Publisher:Emerald Group Publishing Limited

Purpose – The purpose of this paper is to examine state promotion of private sector development in China, with particular emphasis on local configurations of support and service provision.

Design/methodology/approach – Via analysis of two cases, constraints on the development of small- to medium-sized enterprise (SME) support and enabling environments and infrastructures are explored.

Findings – The cases highlight several fundamental constraints to state support for private sector development, including: an under-developed market for business development and other support services; lack of budgetary facility in municipalities to resource publicly supported services to private SMEs; a lack of expertise within local government to develop mechanisms to engage with and support the development of privately owned enterprises.

Research limitations/implications – The localised nature of implementation of the 2003 SME Promotion Law, at municipal and county level, appears to be a constraint on systematic development of comprehensive SME support systems, as mandated by this law.

Practical implications – First, the private sector has grown without emergence of a purposive infrastructure of direct state support to enable this development, which appears to be a positive outcome from reform. Second, future private sector growth may be constrained should local government not develop mechanisms to engage with the private sector to enable its continued growth and development.

Originality/value – The paper offers insight into current, and future, relations state promotion of enterprise in China.

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