Modeling Potential Productivity Gains from SME Growth: A Monte Carlo Simulation for Turkish Manufacturing Firms

Modeling Potential Productivity Gains from SME Growth: A Monte Carlo Simulation for Turkish Manufacturing Firms

Purpose: The paper estimates the labor-productivity gains that Turkish manufacturing small- and medium-sized enterprises (SMEs) can expect when they scale up from micro to small and from small to medium size classes.Methodology: Using value-added-per-employee data from TurkStat, we run Monte Carlo s...

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Bibliographic Details
Main Author: Fatih Cemil Özbuğday
Format: Article
Language:English
Published: Sanayi ve Teknoloji Bakanlığı 2025-07-01
Series:Verimlilik Dergisi
Subjects:
smes
labor productivity
economies of scale
monte carlo simulation
technology intensity
manufacturing industry
kobi̇’ler
i̇şgücü verimliliği
ölçek ekonomileri
monte carlo simülasyonu
teknoloji yoğunluğu
i̇malat sanayi
Online Access:https://dergipark.org.tr/tr/download/article-file/4824058
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Summary:Purpose: The paper estimates the labor-productivity gains that Turkish manufacturing small- and medium-sized enterprises (SMEs) can expect when they scale up from micro to small and from small to medium size classes.Methodology: Using value-added-per-employee data from TurkStat, we run Monte Carlo simulations that keep the technological tier constant while varying firm size. Log-normal and gamma shock processes are combined with three coefficients of variation (0.5, 1.0, 2.0) to represent alternative degrees of within-class heterogeneity.Findings: High-technology SMEs realize the highest average gains—around TL 260–370 thousand—especially in the small-to-medium transition. Low-technology firms show modest mean improvements and a rising probability of negative outcomes as heterogeneity increases. Log-normal shocks generate fatter upper tails and more extreme winners, whereas gamma shocks deliver narrower central ranges but still sizable outliers at high dispersion.Originality: This is among the first studies to quantify potential productivity pay-offs from SME scaling in Turkey within a fully stochastic framework. By modeling technology-conditioned heterogeneity with aggregate data, it offers fresh evidence for designing conditional subsidies and other targeted industrial-policy tools.
ISSN:1013-1388

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