ABSTRACT
In the manufacturing sector, as we saw in Chapter 1, small businesses in industrialized countries went through a period of relative decline until the 1970s (Nelson, 1990, pp. 11-12). The phenomenon was generalized, even if the situation differed from one country to another. For example, in the United Kingdom, the number of businesses with less than 200 employees declined by 50% between 1935 and 1968, with a less marked decline in Japan. Since this time, however, the decline has been halted and in many countries the number of small businesses is now growing. In developing countries, where the small business concept must be viewed in a different light, small businesses have always constituted the main source of employment. The distribution of businesses by size in these countries often reflects their dual economic structure: large businesses operating in a strongly capitalized market sector, and small businesses operating in the traditional economy in local markets. The number of small businesses has, however, declined in countries that are in the process of becoming industrialized, such as South Korea, Malaysia, Singapore, etc. Thus, the continuing existence of small businesses in under-developed countries is accompanied, on the one hand, by their decline in rapidly industrializing countries, and on the other by their renewed growth in industrialized countries. In both cases, small businesses constitute an inescapable economic reality of increasing importance in terms of job creation.
