The Role of SMEs in Economic Development in Jordan: The Case of Al Hassan Industrial Estate

Abstract

This study aimed at highlighting the role of small and medium enterprises in bringing about economic development in Jordan. The study examined the impact of the number, size of investment and the number of jobs provided by these enterprises on the rate of growth in gross domestic product (GDP) as an indicator for economic development. To achieve its objectives, the study adopted descriptive and quantitative analysis. A linear multi regression model was developed with a growth rate of GDP as dependent variable and the number of institutions, size of investment, and the number of job opportunities as independent variables. The study concluded that each increase by one small or medium enterprise lead to an increase in the rate of growth of GDP by 0.46% , and each increase by one million dinars in the volume of investment in small and medium enterprises lead to an increase in the rate of output growth GDP by 0.23% and every increase of one job opportunity in the small and medium enterprises lead to an increase in the rate of GDP growth by 0.04% . Finally, the study made a set of recommendations in this area such as the need to provide adequate support for small and medium enterprises especially in the field of finance and the need to increase the size of the investment to enhance the economic development in Jordan.