The Government's Role in Improving MSME Business Performance in Denpasar City
DOI:
https://doi.org/10.38035/dijefa.v5i6.3534Keywords:
Business performance, Denpasar City, government role, , MSMEs,Abstract
This study aims to analyze the role of the government in improving the business performance of MSMEs in Denpasar City. Using a quantitative approach and data collection method through questionnaires, this study involved 100 MSME respondents from a population of 32,626. The results of data analysis using Structural Equation Modeling (SEM) show that the role of the government, measured through regulations, access to financing, and training programs, has a positive and significant influence on the business performance of MSMEs. These findings emphasize the importance of government intervention in creating an environment conducive to the growth of MSMEs. In addition, this study identifies the challenges faced by MSMEs in accessing government support, as well as providing recommendations for policymakers to improve the effectiveness of existing programs. Thus, this research contributes to the development of public policies that are more responsive to the needs of MSME actors in Denpasar City.
References
Absah, Y. (2023). Msmes In Medan City During the New Normal. Quality - Access to Success, 24(193), 322–327. https://doi.org/10.47750/QAS/24.193.36
Anuj, Singh, A. N., Khanna, D. R., & Naidu, D. K. (2023). Role of MSME Sector in Growth and Development of the Economy: A Quantitative Investigation. European Economic Letters. https://doi.org/10.52783/eel.v13i1.181
Arsyad, L., Setiawan, E., & Damayanti, A. (2022). The Role of Local Government in Empowering Micro, Small and Medium Enterprises in North Luwu Regency. Dinamis?: Journal of Islamic Management and Bussiness. https://doi.org/10.24256/dinamis.v5i1.3326
Artawan, K., Indraswarawati, S. A. P. A., & Satriya, I. (2023). Pengaruh Insentif Pajak Dalam PMK No. 82 Tahun 2021, Pengetahuan Wajib Pajak, Pelayanan Pajak, dan Sanksi Pajak Terhadap Kepatuhan Wajib Pajak UMKM Di Kota Denpasar. Hita Akuntansi Dan Keuangan. https://doi.org/10.32795/hak.v4i1.3578
Atichasari, A., & Marfu, A. (2023). The Influence of Tax Policies on Investment Decisions and Business Development of Micro, Small, and Medium-Sized Enterprises (MSMEs) and its Implications for Economic Growth in Indonesia. JOURNAL OF ECONOMICS, FINANCE AND MANAGEMENT STUDIES. https://doi.org/10.47191/jefms/v6-i7-32
Augtiah, I., Ariyadi, M. Y., & Bintang, R. A. K. (2023). Implementation of the Business Model Canvas Strategy for MSMEs in Karanganyar Regency. Jurnal EMT KITA. https://doi.org/10.35870/emt.v7i4.1625
Azizah, A., & Rachmawati, L. (2023). The Effect Of Minimum Wages And MSMEs On Economics Growth In Tulungagung. Independent: Journal of Economics. https://doi.org/10.26740/independent.v2i2.50704
Bisht, H. S., & Singh, D. (2020). Challenges faced by micro, small and medium enterprises: a systematic review. World Review of Science, Technology and Sustainable Development. https://doi.org/10.1504/WRSTSD.2020.10035444
Bongomin, G. O. C., Woldie, A., & Wakibi, A. (2020). Microfinance accessibility, social cohesion and survival of women MSMEs in post-war communities in sub-Saharan Africa: Lessons from Northern Uganda. Journal of Small Business and Enterprise Development, 27, 749–774. https://doi.org/10.1108/jsbed-12-2018-0383
Chen, C.-L., Lin, Y.-C., Chen, W.-H., Chao, C.-F., & Pandia, H. (2021). Role of Government to Enhance Digital Transformation in Small Service Business. Sustainability. https://doi.org/10.3390/SU13031028
Choi, S., Han, S., & Kwak, K. (2021). Innovation Capabilities and the Performance of Start-Ups in Korea: The Role of Government Support Policies. Sustainability, 13, 6009. https://doi.org/10.3390/SU13116009
Cruz, N. D. Dela, Villanueva, A. C. B., Tolin, L., Disse, S., Lensink, R., & White, H. (2023). PROTOCOL: Effects of interventions to improve access to financial services for micro?, small? and medium?sized enterprises in low? and middle?income countries: An evidence and gap map. Campbell Systematic Reviews, 19. https://doi.org/10.1002/cl2.1341
Dewi, N. G., Ridhasyah, R., & Wibawa, T. A. (2023). Financial Access and MSMEs Performance during Pandemic COVID-19: The Moderating Role of Digitization. Journal of Developing Economies. https://doi.org/10.20473/jde.v8i1.36843
Fathima, J. S. (2020). A Study on Competitive Performance and Progress of Micro, Small and Medium Enterprises (MSMEs) in India. Management Science, 7, 52–61. https://doi.org/10.34293/management.v7i4.2161
Feranita, N. V., Nugraha, A., & Sukoco, S. A. (2020). THE ROLE OF GOVERNMENT SUPPORT FOR INNOVATION AND PERFORMANCE OF SMEs. POLITICO. https://doi.org/10.32528/POLITICO.V19I2.2932
Fomum, T. A. (2023). Financial inclusion and performance of MSMEs in Eswatini. International Journal of Social Economics, 50(11), 1551–1567. https://doi.org/10.1108/IJSE-10-2020-0689
Gamo, K. G., & Gollagari, R. (2020). Role of Local Government and MSMEs Performance: The Case of Ethiopia. 3, 1–17. https://doi.org/10.46281/ijsmes.v3i1.511
Gusti, I., Agung, A., Pryanka, V., Putu, N., & Setyari, W. (2022). Analysis of MSME Competitiveness in Denpasar During the COVID-19 Pandemic. Integrated Journal of Business and Economics. https://doi.org/10.33019/ijbe.v6i1.411
Hadi, D. P. (2023). The Impact of the Omnibus Low Cipta Kerja on the Sustainability of MSMEs and Economic Growth by Applying the Canvas Model Business Method and the Use of Financial Technology, Especially Crowdfunding and Microfinance. International Journal of Sustainable Development and Planning, 18(2), 505–513. https://doi.org/10.18280/ijsdp.180219
Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report the results of PLS-SEM. European Business Review, 31(1), 2–24. https://doi.org/10.1108/EBR-11-2018-0203
Idawati, I. (2021). Impact of Tourism Decrease Due To Pandemic on the Performance and Sustainability of MSMEs in Denpasar City. International Journal of Social Science and Human Research. https://doi.org/10.47191/ijsshr/v4-i11-16
Idpo, I., Widhianthini, W., Arisena, G., Sukewijaya, I., & Krisnandika, A. (2023). Status of agriculture resources sustainability and agricultural policy in Denpasar city, province of Bali, Indonesia. African Journal of Food, Agriculture, Nutrition and Development. https://doi.org/10.18697/ajfand.118.21875
Ismail, A. (2022). The Role of Government Ownership Towards the Performance Management Decisions in the Government-Linked Companies. 2022 International Conference on Decision Aid Sciences and Applications (DASA), 143–146. https://doi.org/10.1109/DASA54658.2022.9765212
Khurana, S., Haleem, A., Luthra, S., & Mannan, B. (2021). Evaluating critical factors to implement sustainable oriented innovation practices: An analysis of micro, small, and medium manufacturing enterprises. Journal of Cleaner Production, 285, 125377. https://doi.org/10.1016/j.jclepro.2020.125377
Khusaini, K., Lestari, L. W., Widiarti, A., & Suherman, A. (2022). Social Capital and Location as Determinants in Improving MSME Performance. Jurnal Pendidikan Ekonomi Dan Bisnis (JPEB). https://doi.org/10.21009/jpeb.010.2.3
Kilay, A. L., Simamora, B. H., & Putra, D. P. (2022). The Influence of E-Payment and E-Commerce Services on Supply Chain Performance: Implications of Open Innovation and Solutions for the Digitalization of Micro, Small, and Medium Enterprises (MSMEs) in Indonesia. Journal of Open Innovation: Technology, Market, and Complexity, 8(3), 119. https://doi.org/https://doi.org/10.3390/joitmc8030119
Maesaroh, S. S. (2021). Determinants of Loan Access towards Financial Performance in MSMEs. Conference Series. https://doi.org/10.34306/conferenceseries.v3i2.585
Marwanto, G. G. H., Rahmadi, A. N., & Yap, N. (2023). Evaluation of Micro, Small And Medium Enterprises (MSMES) Financing Policies For MSME Actors In Yogyakarta. Return?: Study of Management, Economic and Bussines. https://doi.org/10.57096/return.v2i05.100
Mirta, I., Candranegara, I. M. W., & Anggriyani, N. (2022). Denpasar Youth Festival: Digital Innovation in Increasing the Creativity and Productivity of The Youth Generation. Iapa Proceedings Conference. https://doi.org/10.30589/proceedings.2022.691
Mohapatra, S., Commerce, P. G. in, & Finance., M. in. (2020). Regional Trends in Financing and Growth of Indian MSMEs. International Journal of Management and Humanities. https://doi.org/10.35940/ijmh.c1164.115320
Nursini, N. (2020). Micro, small, and medium enterprises (MSMEs) and poverty reduction: empirical evidence from Indonesia. Development Studies Research, 7, 153–166. https://doi.org/10.1080/21665095.2020.1823238
Ogbu, C., & Osazuwa, E. M. (2023). Barriers to the growth of indigenous construction firms in Nigeria. Engineering, Construction and Architectural Management. https://doi.org/10.1108/ecam-03-2023-0211
Olayemi, O., Okonji, P., & Ogbeiwi, M. O. (2022). Ease of Doing Business Reforms and Business Growth Among Selected Micro, Small And Medium Enterprises (MSMEs) in Present Day Nigeria: a Hierarchical Multiple Regression Modelling Approach. Journal of Economics and Management Research. https://doi.org/10.22364/jemr.10.04
Olorunshola, D. T., & Odeyemi, T. I. (2022). Virtue or vice? Public policies and Nigerian entrepreneurial venture performance. Journal of Small Business and Enterprise Development. https://doi.org/10.1108/jsbed-07-2021-0279
Onyeje, S. A., Court, T., & Agbaeze, E. (2020). National Enterprise Policy Dimensions and Sustainability of Micro, Small and Medium Enterprises (MSMEs). Journal of African Business, 23, 435–453. https://doi.org/10.1080/15228916.2020.1838838
Prakash, B., Kumar, I., & Verma, J. K. (2021). Barriers and potential solutions for MSMEs in developing economies: Evidence from India. Problems and Perspectives in Management. https://doi.org/10.21511/ppm.19(4).2021.26
Prapanca, D., Yani, M., Sari, H. M. K., Gerung, V. M., & Eva, A. (2023). Driving Business Performance: Cost Leadership and Government Innovation in SME Partnerships. Indonesian Journal of Law and Economics Review. https://doi.org/10.21070/ijler.v18i3.939
Purwoko, P., Judijanto, L., Abidin, Z., & Antesty, S. (2023). Sustainability Practices in MSMEs: A Quantitative Analysis of the Impact of Green Supply Chain Management, Consumer Awareness, and Regulatory Compliance on Market Performance. West Science Interdisciplinary Studies. https://doi.org/10.58812/wsis.v1i10.298
Putra, I. K. M., Pasek, I., & Sukarta, I. W. (2019). Competitiveness Enhancement and MSME Performance Through Development of Internal, External, and Entreprenual Skills in Bali Province. Proceedings of the International Conference On Applied Science and Technology 2019 - Social Sciences Track (ICASTSS 2019). https://doi.org/10.2991/icastss-19.2019.63
Putranto, P., & Ariani, M. (2020). Coaching MSMEs through the Business Development Services Program. PARAHITA?: Jurnal Pengabdian Kepada Masyarakat. https://doi.org/10.25008/parahita.v1i1.37
Rajamani, K., Jan, N. A., Subramani, A., & Raj, A. N. (2022). Access to Finance: Challenges Faced by Micro, Small, and Medium Enterprises in India. Engineering Economics. https://doi.org/10.5755/j01.ee.33.1.27998
Riwanto, A., Suryaningsih, S., & Putri, D. K. (2023). Reform and Breakthrough in Business Regulations for Empowering MSMEs in Indonesia and the Netherlands. Journal of Human Rights, Culture and Legal System. https://doi.org/10.53955/jhcls.v3i3.109
Rumijati, A. (2023). Innovative work behavior and self-efficacy: Does entrepreneurial leadership impact MSME business performance? Problems and Perspectives in Management, 21(4), 304–315. https://doi.org/10.21511/ppm.21(4).2023.24
Shara, A. R. I. D. (2021). Analysis of Basic and Non-Basic Sectors in Denpasar City in the middle of Covid-19 Pandemic Era. Sustainability (STPP) Theory, Practice and Policy. https://doi.org/10.30631/sdgs.v1i2.1012
Simarmata, J. (2023). Pengaruh Stimulus Inovasi terhadap Kinerja Inovasi Dengan Kapabilitas Inovasi sebagai Mediator: Analisis Empiris Pada Industri Batik. Jurnal Ilmiah Universitas Batanghari Jambi. https://doi.org/10.33087/jiubj.v23i1.3111
Sindhwani, R., Hasteer, N., Behl, A., Varshney, A., & Sharma, A. (2022). Exploring “what,” “why” and “how” of resilience in MSME sector: a m-TISM approach. Benchmarking: An International Journal. https://doi.org/10.1108/bij-11-2021-0682
Singh, M., Rathi, R., & Garza?Reyes, J. (2021). Analysis and prioritization of Lean Six Sigma enablers with environmental facets using best worst method: A case of Indian MSMEs. Journal of Cleaner Production, 279, 123592. https://doi.org/10.1016/j.jclepro.2020.123592
Singh, S., Chamola, P., Kumar, V., Verma, P., & Makkar, N. (2022). Explaining the revival strategies of Indian MSMEs to mitigate the effects of COVID-19 outbreak. Benchmarking: An International Journal. https://doi.org/10.1108/bij-08-2021-0497
Suasih, N., & Budhi, M. (2023). Mitigation Policies for Fashion Smes Affected by The Covid-19 Pandemic. Quality - Access to Success. https://doi.org/10.47750/qas/24.194.31
Sugiyono, P. (2021). Metode Penelitian Kuantitatif Kualitatif Dan R&D, Ed.1. In Bandung: Alfabeta: Vol. Ed.1.
Supardi, A. F. H. (2020). Analysis on the Influence of Government Regulation No 46 of 2019 the Impact of MSME Business on MSME Business Performance from SOE Income. Solid State Technology, 63, 4775–4787. https://consensus.app/papers/analysis-influence-government-regulation-2019-impact-supardi/077505a876bc5953858a23434340fd87/
Susilowati, M., Wahyuningdyah, R. Y., & Kurniasari, W. (2020). Developing Ecotourism and its Supporting MSMs Using Performance, Opportunity and Results Analysis. Case Study in Pekalongan Regency, Indonesia. Journal of Environmental Management and Tourism. https://doi.org/10.14505//JEMT.V10.8(40).24
Timotius, E. (2023). “The role of innovation in business strategy as a competitive advantage: Evidence from Indonesian MSMEs.” Problems and Perspectives in Management, 21(1), 92–106. https://doi.org/10.21511/ppm.21(1).2023.09
Utama, S., Yusfiarto, R., Pertiwi, R. R., & Khoirunnisa, A. (2023). Intentional model of MSMEs growth: a tripod-based view and evidence from Indonesia. Journal of Asia Business Studies. https://doi.org/10.1108/jabs-08-2022-0291
Wahyuda, O., Syukur, M.-H. A., Purmono, B. B., Pebrianti, W., & Setiawan, H. (2023). Empowerment of Indonesian MSME Business Performance: An Empirical Analysis of Knowledge Sharing and Innovation. International Journal of Scientific Research and Management. https://doi.org/10.18535/ijsrm/v11i01.em06
Wardana, I., Sukaatmadja, I. P., & Setini, M. (2022). Formulation of Business Strategies to Improve Business Performance by SWOT and SQSPM Approach in Era Pandemic: A Study on Culinary MSMEs. Quality - Access to Success. https://doi.org/10.47750/qas/23.188.07
Wulansari, A., Hakim, L., & Ramdani, R. (2021). Strategi Dinas Koperasi dan UMKM Kabupaten Karawang Dalam Pemberdayaan UMKM. 7. https://doi.org/10.30996/JPAP.V7I1.5172
Zhang, Y., & Ayele, E. Y. (2022). Factors Affecting Small and Micro Enterprise Performance with the Mediating Effect of Government Support: Evidence from the Amhara Region Ethiopia. Sustainability. https://doi.org/10.3390/su14116846
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2024 I Gde Arjawa, I Made Pulawan, Putu Ayu Sita Laksmi
This work is licensed under a Creative Commons Attribution 4.0 International License.
Authors who publish their manuscripts in this journal agree to the following conditions:
- The copyright on each article belongs to the author(s).
- The author acknowledges that the Dinasti International Journal of Economics, Finance & Accounting (DIJEFA) has the right to be the first to publish with a Creative Commons Attribution 4.0 International license (Attribution 4.0 International (CC BY 4.0).
- Authors can submit articles separately, arrange for the non-exclusive distribution of manuscripts that have been published in this journal into other versions (e.g., sent to the author's institutional repository, publication into books, etc.), by acknowledging that the manuscript has been published for the first time in the Dinasti International Journal of Economics, Finance & Accounting (DIJEFA).
