| This study examines growth of food processing Micro and Small Enterprises (MSEs) in Tanzania. Unlike other studies, it incorporates behavioural economic theories to form models that consider owner's objectives when measuring the performance of the enterprises. It further analyzes gender differences in the growth of MSEs, and identifies factors influencing growth. Three different models were used to measure the performance of MSEs, namely the entrepreneur's level of satisfaction in achieving his/her multiple objectives, growth in gross margins and growth in employment.; Data for the study were collected through a survey of 164 food processing MSEs in Dar Es Salaam, Tanzania. Observed growth rates were used as dependent variables in logit regression models to estimate the role of influencing factors. Further, an additive index was developed to measure the level of satisfaction in achieving multiple objectives. The index was used as the dependent variable in a linear regression model. Finally, confirmatory factor analysis techniques were used to derive latent explanatory variables for the regression models that relate to constraints on MSE activities.; The results show that: (1) performance was greatest in terms of achievement of objectives, followed by growth in GM and finally growth in employment; (2) the majority of the MSEs with growth in both employment and GM were owned by male entrepreneurs; (3) female entrepreneurs had the highest GM growth rates; (4) there were no gender differences in the level of objective achievement, although there were some gender-based differences in the types of objectives that were achieved; (5) entrepreneurship, own finance resources, input access and input cost were identified as success factors for MSEs growth. Other influencing factors included number of years in operation, number of dependents, higher education and experience as an informal sector employee.; Two implications were drawn from the results. First, MSEs may exhibit significant growth and achievement of objectives, contrary to much of the existing literature. Second, also contrary to previous studies, female entrepreneurs can exhibit MSE growth rates comparable to those of male entrepreneurs. The results indicate the role of a variety of internal and external resources as constraints on growth and/or achievement of objectives that need to be addressed by government policies. |
