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Introduction
There is a broad consensus that despite their size, small- and medium-sized enterprises (SMEs) produce more jobs than large ones and are an essential driver for growth and innovation. For example, empirical research reveals that small firms in the USA spend almost twice as much of their R&D dollars in fundamental research compared to the large firms ([37] Yeung and Chew, 2001). [29] Parker (2000) also notes that government support for SMEs is increasing in the wealthy countries and is based on the view that SMEs contribute to high-quality employment generation and are exceptionally innovative. There is a perception that SMEs are also more flexible and responsive to demands of consumers.
Singapore has a large community of around 148,000 SMEs. Together, they make up 99 percent of all enterprises, employ 66 percent of the workforce, and account for 48 percent of total value added in the economy ([34] Spring Singapore, 2008). A recent 2010 publication of the Singapore Government suggests that the figures remain largely unchanged with SMEs still accounting for 99 percent of all enterprises, 62 percent of the workforce, and 50 percent of total value added in the economy. In the ASEAN region, SMEs play an important role also as they account for 99 percent of all enterprises, 70 percent of the workforce, and 40 percent of GDP ([20] IE Singapore, 2010)[1] .
The definition of SMEs differs from each country according to the number of employees or value of assets. In the Singaporean context, domestic SMEs are defined as companies with least 30 percent local equity (owned by Singapore residents) and fixed productive assets (defined as net book value of factory building, machinery, and equipment) not exceeding S$15 million (US$ 11.6 million) and employment size not exceeding 200 workers for commerce or services sectors (non-manufacturing sector) ([33] SME 21 Committee, 2000).
Given the importance of SMEs in the Singaporean context, research related to the prediction of success and failure of SMEs can potentially benefit many future and current small-business owners; help those who assist, train, and advise them; provide capital for their ventures along with their suppliers; and provide guidance to public policy makers ([24] Lussier and Pfeifer, 2001).
Literature review
[23] Lussier (1995) developed the so-called "Lussier model", a...