The influence of business barriers on innovative performance of SMEs in Namibia

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The focus of this research is on investigating which barriers SMEs encounter in Namibia, how these barriers influence the innovative performance of firms and whether this impact is moderated by firm size. The main barriers encountered in Namibia are: access to finance, access to land and corruption. The influence of these variables and their interaction with firm size on innovation is analysed using a logistic regression. In this regression the control variables firm size, electricity, tax rates, practices of competitors in the informal sector, and firm sector are used. The logistic regression revealed the model to have a modest amount of explanatory power, while the overall percentage of accuracy increased marginally. Moreover, neither the overall main effects nor the interaction effects with firm size of the variables access to finance, access to land and corruption were found to be statistically significant in the logistic regression. Only the category major obstacle of the variable corruption was indicated to have a statistically significant negative relationship with innovation. Three of the control variables were found to have a statistically significant component: firm size, sector (manufacturing) and the category major obstacle of the variable tax rates. However, considering the modest explanatory power of the overall model, the influence of these control variables should not be overestimated. Lastly, a post hoc analysis of the influence of the interaction access to land and access to finance on innovative performance was not found to be statistically significant.
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