Is it Enough to be Entrepreneurial? Enhancing the ‘Value Added’ Created by SMEs in Turkey through Innovation

Similar to other developed and developing economies in the world, SMEs play a predominant role in Turkey. Nevertheless, the contribution of SMEs to total value added (57%) was much lower than their contribution to employment (81.3%) in Turkey. This finding indicates a potential low level of apparent labour productivity. And the potential reasons of this situation are worth discussing. Low R&D expenditures and low employment in knowledge-intensive activities are proposed to be factors related with this situation. The sample of this study is the common member countries of both OECD and EU27.