Determinants of SMEs' Access to Governmental Support Programs: Evidence from Jordan Using Logistic Regression An Applied Study on the Jordan Enterprise Development Corporation (JEDCO)

Abstract

Objectives: This paper investigates the determinants influencing the acceptance of applications submitted by small and medium-sized enterprises (SMEs) owners seeking to benefit from governmental support programs. Given the continued and substantial demand for these programs- evidenced by the number of applicants- identifying the factors that govern acceptance or rejection constitutes an important research question, with implications for broadening the beneficiary base and stimulating economic activity in Jordan. The research aims to identify the determinants that most significantly influence acceptance outcomes.

Methods: The research employs a quantitative econometric approach, utilizing binary logistic regression which is well-suited for the analysis of primary categorical data. Data were collected through an electronic questionnaire.

Results: Several independent variables hypothesized to influence the probability of acceptance into governmental support programs were tested. The results indicate that enterprise activity sector was statistically significant as an overall predictor of acceptance probability, followed by enterprise geographic location and enterprise readiness. Enterprises located in the Central Region had approximately 7.9 times higher odds of acceptance compared with those in the Southern Region, while institutionally ready enterprises had approximately 2.09 times higher odds of acceptance than non-ready enterprises. Agricultural and service-sector enterprises showed lower odds of acceptance compared with industrial enterprises, with odds ratios of 0.362 and 0.253, respectively. However, these sector-specific results should be interpreted with caution, since the individual sector coefficients were not statistically significant at the 5% level, despite the overall significance of the enterprise activity variable.

Conclusions: The research concludes that enterprise activity sector, enterprise geographic location, and readiness of enterprise were the most prominent factors influencing acceptance into support programs. Conversely, the gender of the enterprise manager and enterprise size were found to be statistically non-significant determinants of acceptance.

Recommendations: The research recommends: (1) conducting more targeted awareness workshops for agricultural and service-sector enterprises to improve their acceptance rates; (2) intensifying the outreach and promotional campaigns for governmental support programs among enterprises in the Southern Region of Jordan; and (3) incentivizing enterprises to transition toward the formal economy through reduced transaction fees, tax exemptions, and streamlined administrative procedures.