The Impact of Easing Firm Constraints on Small and Medium Enterprises Growth: Evidence from Uganda

Research Note
Published on 14 March 2018


This study finds that wage subsidy policies that allow firms to choose who to hire and how to spend the subsidy lead to firm expansion and the creation of net employment. Instead, tying the provision of wage subsidies to hiring and sharing the monetary transfer with a specific worker leads firms to replace existing workers with the new hires.