Scaling without mass: a model to foster SMEs' growth and productivity

Summary

The New Digital Economy (mobile internet and cloud use) has the potential to transform the way in which SMEs combine capital and labor to obtain improvements in productivity levels, so that size could no longer be a limitation under this scenario.

Key points

• Key points:
• Traditionally, both theory and empirical evidence have suggested that a larger size of firms favours productivity determinants such as efficiency or innovation, thus generating higher levels of productivity in larger firms
• The New Digital Economy involves moving away from investment in ICT capital goods in favour of access to this technology through payment for services on demand.
• The digital transformation could facilitate innovation, promote competition, and improve efficiency and flexibility, regardless of the size of the company.

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