ECONOMIC DETERMINANTS OF SMALL BUSINESS DEVELOPMENT IN THE LVIV REGION: INSIGHTS FROM REGRESSION ANALYSIS
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Abstract
Purpose. This research aims to investigate the factors influencing small business development in the Lviv region of Ukraine. Specifically, we seek to identify the impact of economic indicators such as Gross Regional Product (GRP), Foreign Direct Investment (FDI), and foreign trade participation on the number of small enterprises. Methodology. A quantitative research approach was employed to analyze the relationship between the aforementioned variables. A multiple linear regression model was constructed using data from the State Statistics Service of Ukraine and the Main Department of Statistics in the Lviv region. The model was estimated using statistical software to determine the significance and magnitude of the coefficients. Results. The empirical analysis revealed several key findings. Firstly, GRP and FDI were found to have a positive and statistically significant impact on the number of small enterprises in the Lviv region. This suggests that economic growth and foreign investment can stimulate entrepreneurship and business creation. Secondly, foreign trade participation exhibited a negative relationship with small business development. This finding may be attributed to factors such as increased competition from imported goods or the dominance of large-scale enterprises in the region's export sector. Practical implications. The results of this study have important implications for policymakers, business owners, and other stakeholders in the Lviv region. Policymakers can utilize these findings to develop targeted interventions aimed at fostering a conducive environment for small business growth. For instance, policies that promote economic growth, attract foreign investment, and support local entrepreneurs can contribute to the region's economic prosperity. Small business owners and entrepreneurs can benefit from the insights gained through this research by understanding the factors that drive growth and the challenges that may hinder it. By making informed decisions about their business strategies and operations, they can increase their chances of success. Value / Originality. This research contributes to the existing literature on small business development by providing empirical evidence on the factors influencing small business growth in a specific regional context. The use of a quantitative approach and the application of a multiple linear regression model enhance the rigor and reliability of the findings. Additionally, the study highlights the complex interplay of economic factors and their impact on small business development, offering valuable insights for policymakers and practitioners.
How to Cite
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small business, economic growth, regional economics, innovations, gross regional product, foreign direct investment, foreign trade, regional development
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