The roles of Small and Medium Scale Enterprises in Nigerian economic growth: An empirical analysis

The study addresses the roles of small and medium scale enterprises SMES toward accelerating the economic growth and development in a manner in which they enhance effective utilization of local resources. However, the militating challenges faced by SMES are that while making policy by the government, much attention is not being paid to them. This, makes their financing the main problem to SMES growth and blocks their potential for reaping economic growth in Nigeria. Thus, with regards to the identified issues, the study investigated the roles of SMES in economic development in Nigeria between 1981 to 2002.It made use of Ordinary Least Square OLS, two stage Least square 2SLS and Vector Error Correction Model VECM method while estimating the regression model. The end result of this analysis shows that, when we proxy the SME as a component of Gross Domestic Product GDP, it portrayed the nagetive influence on economic growth. Therefore, based on the finding of the study, the central authority should pay more attention for the development of SMES. Key Words: Small and medium scale enterprises, economic growth.