Author(s):
1. Suzana Stefanovic, Bahamas

Abstract:
Macroeconomic business conditions in Serbia are still quite unfavorable in the post-recession period. Unfavorable business conditions are reflected primarily in: a negative Trade Balance and Balance of Payments, high rate of inflation, which still cannot be reduced to the level of targeted single-digit inflation, high unemployment rate and, consequently, a low standard of living. Although the growth of the entrepreneurial sector is identified as a key factor in the development of Serbian economy and overcoming the burning problem of unemployment, Serbia is faced with many issues related to the evolvement of this sector as well as its increased participation in the economy. Data submitted by the Serbian Business Registers Agency show that the number of newly established entrepreneurs in Serbia in 2010 are for the first time less than the number of those that have gone out of business over the previous year. These data were the basis for the analysis of constraints and factors that brought about this situation. The high mortality rate of entrepreneurial ventures indicates the presence of a large number of problems that limit the development of entrepreneurship in Serbia. Besides the impact of the global economic crisis and macroeconomic instability, which generally adversely affect the stability and growth of entrepreneurship in Serbia, a survey carried out on entrepreneurs and managers of SMEs by the Republic Agency for Development of Small and Medium Enterprises and Entrepreneurship revealed a number of other restrictions to the entrepreneurship expansion in Serbia. Some of the key constraints are: lack of financial resources, administrative obstacles, the insufficiency of qualified labor, lack of information on markets and technologies, non-compliance with standards, and other less significant issues. Therefore, objective of the paper is to stress the influence of the major problems and restrictions to the development of the entrepreneurial sector in Serbia. Constraints to the growth of entrepreneurship are going to be perceived through the prism of (insufficient) financial investments that the government makes to overcome them. Also, by using statistical analysis methods, it will be tested whether and to what extent each of these factors affect the number of start-ups and the number of their employees. Based on these results, certain recommendations to the economic policy makers will be given. They will focus on the measures, which can be taken to eliminate the key problems and encourage the development of entrepreneurship in Serbia.

Key words:
Entrepreneurship, Serbian Economy, Constraints to Growth, Start-ups.

Opening paper:
Yes

Date of abstract submission:
10.06.2011.

Number of visits:
780

Conference:
REDETE 2011

Applied paper from author