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The Financing and Technology Decisions of SMEs: I. Finance as a Determinant of Investment

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  • Alexander Cobham

Abstract

This paper surveys the theoretical and empirical literature on the financing of investment in order to lay the foundation for subsequent analysis of technology investments by Southern European SMEs. By adapting a variety of approaches to suit this purpose, a number of findings for policy are reached. In particular, it is found that support for highly successful SMEs is distinct from support for struggling SMEs, and that each has different implications for innovation and employment. Furthermore, policy to encourage banking efficiency and policy to stimulate venture capital investment are seen as competing ways forward, with potentially very different results for SMEs' technology investment. The most significant suggestion of this paper, however, is that finance may determine not just the level but also the nature of technology investment.

Suggested Citation

  • Alexander Cobham, "undated". "The Financing and Technology Decisions of SMEs: I. Finance as a Determinant of Investment," QEH Working Papers qehwps24, Queen Elizabeth House, University of Oxford.
    • Handle: RePEc:qeh:qehwps:qehwps24
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    File URL: http://workingpapers.qeh.ox.ac.uk/RePEc/qeh/qehwps/qehwps24.pdf
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    References listed on IDEAS

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    Cited by:

    1. Pontikakis, D. & Lin, Y. & Demirbas, D., 2006. "History matters in Greece: The adoption of Internet-enabled computers by small and medium sized enterprises," Information Economics and Policy, Elsevier, vol. 18(3), pages 332-358, September.
    2. Edmund Mallinguh & Christopher Wasike & Zeman Zoltan, 2020. "Technology Acquisition and SMEs Performance, the Role of Innovation, Export and the Perception of Owner-Managers," JRFM, MDPI, vol. 13(11), pages 1-19, October.
    3. Alexander Cobham, "undated". "Making Bad Decisions: firm size and investment under uncertainty," QEH Working Papers qehwps39, Queen Elizabeth House, University of Oxford.
    4. Alexander Cobham, "undated". "The Financing and Technology Decisions of SMEs: II. Technology and Policy," QEH Working Papers qehwps25, Queen Elizabeth House, University of Oxford.
    5. Pasquale Lucio Scandizzo, 2004. "Financing Technology: An Assessment of Theory and Practice," CEIS Research Paper 43, Tor Vergata University, CEIS.
    6. Bartzokas, Anthony, 2001. "Financial Markets and Technological Change: Patterns of Technological and Financial Decisions by Manufacturing Firms in Southern Europe," UNU-INTECH Discussion Paper Series 2001-04, United Nations University - INTECH.

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