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Perceived credit constraints in the European Union

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  • Erik Canton

    ()

  • Isabel Grilo

    ()

  • Josefa Monteagudo

    ()

  • Peter Zwan

    ()

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    Abstract

    The promotion and support of small and medium-sized enterprises (SMEs) is an essential component of policies designed to help improve Europe’s economic performance. A crucial issue is whether SMEs face difficulty obtaining bank loans. Using pre-crisis survey data from 2005 and 2006 for nearly 3,500 SMEs (firms with fewer than 250 employees) in the European Union (EU), we investigate the determinants of perceived bank loan accessibility at the firm level and at the country level. Based on hierarchical (multi-level) binomial logit regressions, our findings show that the youngest and smallest SMEs have the worst perception of access to bank loans. The SMEs in nations with concentrated banking sectors are more positive about loan accessibility. In addition, a high fraction of foreign-owned banks is associated with improved perception of loan accessibility in the EU 15 but not in the EU 10. Copyright Springer Science+Business Media New York 2013

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    Bibliographic Info

    Article provided by Springer in its journal Small Business Economics.

    Volume (Year): 41 (2013)
    Issue (Month): 3 (October)
    Pages: 701-715

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    Handle: RePEc:kap:sbusec:v:41:y:2013:i:3:p:701-715

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    Web page: http://www.springerlink.com/link.asp?id=100338

    Related research

    Keywords: Bank loans; Money supply; SMEs; Credit constraints; Concentration index; Multi-level; E44; E51; G15; G21;

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    Cited by:
    1. Peter van der Zwan, 2014. "Bank loan application success by SMEs: the role of ownership structure and innovation," Scales Research Reports H201404, EIM Business and Policy Research.

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