Impact of Small and Medium Enterprises on the Economic Development of the Republic of Macedonia

The contemporary working conditions that are characterized by dynamic structural changes, development of information technology, internationalization of businesses, ever increasing of the global competition, and finally the increase of insecurity, have imposed the urgency to develop the small and medium-sized enterprises as a highly dynamic sector. For this reason, the importance to research this topic arises, because it presents itself a very current issue, not only locally, but also nationally and internationally. Given the above, the aim of the paper is to analyze the role and influence of the small and medium-sized enterprises in performing economic operations and their contribution to the economic development in the Republic of Macedonia. As a result, the set hypothesis of this scientific work reads as follows: the gross added value of the small and medium-sized enterprises has a significant impact on the country’s GDP. Research has shown the substantial impact of the sector of small and medium enterprises on GDP. Indicated impact on GDP makes sense because between independent variables the multicollinearity has been removed, and therefore it can be seen the isolated effect of one variable on GDP. The model was verified through a test of determination where R² = 0.952. This means that the model provides a basis for predicting with 95.2 % accuracy.Keywords: small and medium-sized enterprises, gross added value, Republic of Macedonia