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Conept of Micro Enterprise

This research presents an inbreadth examination of the concept of microenterprise, its relationship to the economicdevelopment of non industrialized countries, and the financing of microenterprise. This inbredth examination provides an overview of the topic.

Microenterprises are located in both urban and rural areas in developing countries.1 The term microenterprise refers to the economic activities of individuals whose primary source of income is "trading, cottage industries, and a wide range of services, generally categorized as offfarm activities."2

In rural areas, individuals involved in microenterprise account for a significant segment of the workingage population in developing countriesthe range is from 19 to 49 percent.3 In the urban areas of developing countries (where subsustence and smallscale farming is not feasible), between 30 and 70 percent of the labor force is employed in microenterprise.4

Microenterprise, thus, clearly represents a significant segment of the economy in developing countries. For successful development, the needs of microenterprise must be addressed.

MICROENTERPRISE AND OTHER ECONOMIC PLAYERS

Governments in developing countries, as well as most international organizations assisting development in such countries, tend to favor the flow of investment funds to "capitalintensive projects undertaken by large firms."5 Small and mediumsized firms in developing countries are then "forced to seek out credit from the informal . . . financial markets, or . . rely on selffinancing."6 Individuals engaged in microenterprise in developing countries frequently have no place to which to turn for capital.

Although studies have found that financial assistance to microenterprise yields highly positive results for developing countries, the emphasis remains, for the most part, on larger enterprises, including multinational corporations (MNCs). Some observers take a di...

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Conept of Micro Enterprise. (1969, December 31). In LotsofEssays.com. Retrieved 16:05, December 07, 2021, from https://www.lotsofessays.com/viewpaper/1691399.html