Small Business in the Development Process of the Philippines

Abstract

Dr. Wolfgang Kbnig and Joachim Peters lecture at the University of Gbttingen, Germany. The paper is the result of research on industrial co-operation between developed and developing countries and is partly based on field work done in the Philippines in 1984. It deals with the impact that business size has on the pattern of development of this country and specially evaluates the role of small-scale firms. Controversial issues boil down to two competing approaches as far as the further promotion of these units is concerned. One approach consists of taking a broad range of selective measures in order to compensate small business for discrimination suffered from macro-economic instruments and to enhance its prospects in this way. The other approach stresses the danger of market distortion and therefore recommends a policy of deregulation in order for market forces to mobilize the potential of small business. Consideration of the pros and cons of these approaches leads, among others, to the conclusion that assistance to institution building is important as long as it is backed by the will to self-help of the small business community in the Philippines.