Surviving the COVID-19 pandemic: European and African SMEs and domestic public policies compared

What is it about?

We study the relative degrees of success European and African SMEs experienced in surviving COVID-19. We test hypotheses drawn from three main bodies of theory: Resource Dependency Theory and institutional theory’s Business Systems and Varieties of Capitalism variants which we augment with a feminist theory dimension. Our article answers the theoretical question of whether SMEs that are resilient to major exogenous shocks may share certain characteristics despite operating in different institutional environments. Our empirical findings support the theoretically posited positive effects of innovativeness, institutional connectedness, and governance capability on SMEs’ survival. Further, we confirm the importance of firm-specific characteristics (financial status, size, age) for SMEs survival. Female-owned SMEs are more likely to suffer during COVID-19, especially in Africa. The results are more nuanced when we consider industry specificity and heterogeneity of government support.

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