Abstract:
This research article evaluates the impact of the monetary and fiscal policy of the EU member states on the SMEs performance in the period 2005-2012 through a Generalized Method of Moments (GMM) estimation. We performed our analysis on the EU member states except for Croatia and Malta due to lack of data. The monetary policy was quantified by domestic credit to private sector and inflation rate, while the fiscal policy was assessed through government expenditure, education expenditure and research and development expenditure. In our research, we also employed the variables foreign direct investment, fixed broadband Internet subscribers, high-technology exports, and long-term unemployment in order to explain the SMEs growth variation taking into consideration the prior literature in the field. The database was created in Excel, and the quantitative analysis and econometric models were performed in STATA. The main findings are the following: there is a positive relationship between technology, loans, government expenditures and value added of microenterprises and a negative association between education spending and microenterprises performance; loans rate, inflation rate, research and development expenditures, high-tech exports and unemployment rate are positively correlated with the small firms’ value added; there is a positive link between the medium enterprises value-added and foreign direct investments, government expenditure, inflation rate, R&D expenditure and unemployment rate.
