Determinants of Profitability in Micro-enterprises Incorporated by Migrants in“Mercardo Artesanal”, Guayaquil-Ecuador

Maria Belen Bravo Avalos, Maritza Lucia Vaca Cardenas, Gisella Nicole Mino Montero


The main objective of the study was to examine the effects on profitability of socioeconomic factors and business management skills of migrant micro-entrepreneurs. Our results are based on 162 surveys conducted with migrant businesspeople at Mercado Artesanal, in Guayaquil-Ecuador, between February 18-22, 2020. We applied a modified composite index developed in 2016 by Bell for evaluating entrepreneurial skills of Otavaleño migrants, who own micro-enterprises at Mercado Artesanal. We found that over 81% of the microfirms operated by migrants in the examined marketplace are profitable. Differences in profitability between migrant and resident micro-entrepreneurs are also discussed. Like prior study findings our results suggest that migrant micro-entrepreneurs show greater business performance compared to local businessmen. In addition, a straightforward profitability index, SPI, was calculated for assessing the determinants of profitability of local and migrant micro-entrepreneurs. Authors believe that the proposed index should be useful mainly for micro-enterprises and market sellers, where the customary measurement methods cannot be applied.

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Research in World Economy
ISSN 1923-3981(Print)ISSN 1923-399X(Online)


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