Finance and Demand for Skill: Evidence from Uganda |
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| Authors: | Thorsten Beck Burak R. Uras |
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| Affiliation: | 1. Cass Business School, City, University of London, London, UK;2. Tun Ismail Ali Chair, University of Malaya, Kuala Lumpur, Malaysia;3. Centre for Economic Policy Research, London, UK;4. European Banking Center, Tilburg University, Tilburg, Netherlands |
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| Abstract: | We explore the empirical interaction between firm growth, financing constraints, and job creation. Using a novel small-business survey from Uganda, we find that the extent to which small businesses expand skilled employment as their sales and profits increase is significantly related to access to external funding, while the hiring of casual and family workers is not. The results are robust to the inclusion of various firm level controls, region and sector fixed effects. We support our findings by providing empirical evidence on the relationship between planned hiring and firms’ access to finance. |
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