Regional interplay of factors informing SMES’ density in Romania. A panel data analysis

The aim of this paper is to provide an understanding of several factors associated with the SMEs’ density distribution across Romania, and to discuss how some of the variables acknowledged in the international literature as determinants in SMEs’ dynamic are related to SMEs’ density in this case. We fitted four static panel models, one for each category of SMEs, and found a positive impact of both GDP per capita and FDI per capita on the SMEs’ density in each category, which may confirm our initial assumption that SMEs’ density can act as a signal for business opportunity. The density of employees in the research – development sector did not account for any significant contribution, while the percent of people in the 25 – 34 age group is statistically significant but holds an opposite sign to what was expected. Last, but not least, the crisis had an unexpected impact on our dependent variables.