Economic Determinants of Development of Small and Medium-Sized Enterprises in Russia

The main aim of this work is to determine what internal characteristics determine the development of Russian small and medium-sized enterprises. Using a set of panel data from 4,222 of these firms in Russia, we find that sustainable development is associated not only with the traditional determinants of age and size, but also with other specific characteristics related to the financial structure and productivity of the enterprise. In accordance with previous research, we found that the size of a firm, when its total assets increase, tends to increase revenue. Another conclusion is that Russian small and medium-sized enterprises depend to a large extent on domestic funds intended to support the growth of their assets, but they also need access to external capital to support the growth of their revenues. This result confirms the opinion that firms with large cash flows will generate more revenue. This work is organized as follows: the first section examines the general state of small and medium-sized businesses in Russia and summarizes the results of literature research on the determinants of the development of small and medium-sized enterprises. The second section deals with the methodology of panel data, which will be used to evaluate the collected data. The third section discusses the econometric results of panel regressions. Some general remarks are presented in the conclusion.