Regional Development of Small Firms in Poland

Employing a probit and Logit model, this paper demonstrates that small firm development, conceived of in terms of structural, behavior and performance features, is correlated with regional location in Poland. Regional GDP is also shown to be polarizing. The paper uses original data that samples the small firm stratum in two contrasting regions, Gdansk and Lublin. The following variables were shown to be significantly correlated with regional location: legal structure, subcontracting, technological level of the products of the firm, average wage and intention to expand turnover. Policy implications are discussed including the desirability of a regionally differentiated small firm policy that reflects the level of small firm development in a particular region.