World Bank Research Finds Large Firms Drive National Prosperity

Research conducted by the World Bank Group and the University of Toronto reveals that large firms contribute more significantly to national prosperity and GDP per person than small and medium-size enterprises (SMEs). Analyzing data from 164 economies, the study found that high-income nations typically see firms grow larger over time, while poorer economies often experience a missing top characterized by a lack of large-scale enterprises.

Across OECD countries, the productivity of SMEs averages only two-thirds that of larger firms. These findings have led the World Bank to reassess its historical focus on supporting SMEs, with the institution now concluding that small businesses are only economically significant if they possess the capacity to grow into larger entities.

This data emerges amid a contrasting political climate in the United States. While the economic research emphasizes the value of large-scale industry, there is a rising trend of antipathy toward big business. This sentiment is exemplified by the Democratic Socialists of America, which recently published a manifesto calling for the public ownership of the largest corporations.