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Putting development back at the centre of BDS
In this article examining the basis of the market development approach to business development services (BDS) a number of doubts are raised. First, the emphasis on the commercial delivery of BDS inevitably
shifts the focus of interventions towards the formal, growth-oriented sector and away from poorer microenterprises, which are not so much unwilling to pay as unable to pay. Moreover,it is difficult to promote
markets for BDS where the small enterprise sector is not buoyant and demand for such services is very weak. The author distinguishes between business-to-business services, which even the poorest microenterprises
are prepared to pay for, and business development services,which promote growth or innovation and for which microenterprises and small businesses are less willing to pay the full costs because of the risks
involved. It is argued that for such BDS, subsidy is still justified.
shifts the focus of interventions towards the formal, growth-oriented sector and away from poorer microenterprises, which are not so much unwilling to pay as unable to pay. Moreover,it is difficult to promote
markets for BDS where the small enterprise sector is not buoyant and demand for such services is very weak. The author distinguishes between business-to-business services, which even the poorest microenterprises
are prepared to pay for, and business development services,which promote growth or innovation and for which microenterprises and small businesses are less willing to pay the full costs because of the risks
involved. It is argued that for such BDS, subsidy is still justified.
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