Micro and Small Enterprises as an Anti-Poverty and Employment Generation Strategy in Bahir Dar City, North-Western Ethiopia

Abstract

Reducing poverty, unemployment, and inequality is a primary concern of development efforts of the world in general and developing countries in particular. In search of such a viable strategy to realize this goal, the promotion of micro and small enterprises (MSEs) is taken to be an important priority area of intervention, particularly since the 1980s. This article aims to contribute to and inform the ongoing debate on the MSEs approach to development by analyzing data relating to the role of promoting MSEs to employment generation and poverty reduction in Bahir Dar City, Ethiopia. To the fulfillment of this objective, a survey of 136 enterprises using a structured questionnaire and in-depth interview methods along with the analysis of documentary sources were used to generate empirical data. The impact of the MSEs development program is examined in terms of employment creation and income generation for target beneficiaries. The findings reveal that the MSEs program had led to positive outcomes on the income and livelihood conditions of target beneficiaries. Given the importance of the MSEs sector in national development policy and practice, there is particularly little systematic analysis of the subject, however. This article thus provides an exploratory insight into the issue and contributes to the limited academic literature in the area by generating information pertaining to the role of MSEs in employment generation and poverty reduction, hence adding to the broader theoretical debate relating to the role of MSEs in development.