Are Small Innovators Credit Rationed?
AbstractDrawing upon a sample of 256 small firms who applied for bank loans, the current paper is concerned with the extent to which ‘innovativeness’ is associated with a lower level of loan application success. The paper records the proportion of loan successfully applied for and estimates a series of tobit models utilising a number of proxy measures for innovation (in terms of inputs, outputs, and commercial significance to the firm) and incorporating standard controls. In general, the models suggest (as anticipated) that the most innovative firms are less successful in loan markets than their less innovative peers – though there is some variation by proxy. Moreover, there is tentative evidence that ‘a little innovation may be a good thing’. Copyright Springer 2007
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Springer in its journal Small Business Economics.
Volume (Year): 28 (2007)
Issue (Month): 1 (January)
Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=100338
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Stewart C. Myers & Nicholas S. Majluf, 1984. "Corporate Financing and Investment Decisions When Firms Have InformationThat Investors Do Not Have," NBER Working Papers 1396, National Bureau of Economic Research, Inc.
- Guiso, Luigi, 1998.
"High-tech firms and credit rationing,"
Journal of Economic Behavior & Organization,
Elsevier, vol. 35(1), pages 39-59, March.
- Stephen Martin & John T. Scott, 1999.
"The Nature of Innovation Market Failure and the Design of Public Support for Private Innovation,"
CIE Discussion Papers, University of Copenhagen. Department of Economics. Centre for Industrial Economics
1999-02, University of Copenhagen. Department of Economics. Centre for Industrial Economics.
- Martin, Stephen & Scott, John T., 2000. "The nature of innovation market failure and the design of public support for private innovation," Research Policy, Elsevier, vol. 29(4-5), pages 437-447, April.
- Robert H Mcguckin & Bradford J Jensen, 1996.
"Firm Performance And Evolution Empirical Regularities In The U.S. Microdata,"
96-10, Center for Economic Studies, U.S. Census Bureau.
- Jensen, J Bradford & McGuckin, Robert H, 1997. "Firm Performance and Evolution: Empirical Regularities in the US Microdata," Industrial and Corporate Change, Oxford University Press, vol. 6(1), pages 25-47.
- Myers, Stewart C. & Majluf, Nicolás S., 1945-, 1984. "Corporate financing and investment decisions when firms have information that investors do not have," Working papers 1523-84., Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Giudici, Giancarlo & Paleari, Stefano, 2000. " The Provision of Finance to Innovation: A Survey Conducted among Italian Technology-Based Small Firms," Small Business Economics, Springer, Springer, vol. 14(1), pages 37-53, February.
- Moore, Ian & Garnsey, Elizabeth, 1993. "Funding for innovation in small firms: The role of government," Research Policy, Elsevier, vol. 22(5-6), pages 507-519, November.
- Cressy, Robert, 1996. "Are Business Startups Debt-Rationed?," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 106(438), pages 1253-70, September.
- Paul Westhead & David Storey, 1997. "Financial constraints on the growth of high technology small firms in the United Kingdom," Applied Financial Economics, Taylor & Francis Journals, vol. 7(2), pages 197-201.
- Gellatly, Guy & Gaudreault, Valerie & Baldwin, John R., 2002. "Financing Innovation in New Small Firms: New Evidence from Canada," Analytical Studies Branch Research Paper Series 2002190e, Statistics Canada, Analytical Studies Branch.
- Joseph E. Stiglitz, 1993. "Endogenous Growth and Cycles," NBER Working Papers 4286, National Bureau of Economic Research, Inc.
- George Symeonidis, 1996. "Innovation, Firm Size and Market Structure: Schumpeterian Hypotheses and Some New Themes," OECD Economics Department Working Papers 161, OECD Publishing.
- Cressy, Robert & Olofsson, Christer, 1997. " European SME Financing: An Overview," Small Business Economics, Springer, Springer, vol. 9(2), pages 87-96, April.
- James Love & Stephen Roper, 1999. "The Determinants of Innovation: R & D, Technology Transfer and Networking Effects," Review of Industrial Organization, Springer, vol. 15(1), pages 43-64, August.
- Myers, Stewart C. & Majluf, Nicholas S., 1984. "Corporate financing and investment decisions when firms have information that investors do not have," Journal of Financial Economics, Elsevier, Elsevier, vol. 13(2), pages 187-221, June.
- Stoneman, Paul & Canepa, Alessandra, 2002. "Financial Constraints on Innovation: A European Cross Country Study," EIFC - Technology and Finance Working Papers 11, United Nations University, Institute for New Technologies.
- Beck, Thorsten & Demirguc-Kant, Asl' & Maksimovic, Vojislav, 2003. "Bank competition, financing obstacles, and access to credit," Policy Research Working Paper Series 2996, The World Bank.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.