IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this article

Comparing the Impact of Credit Constraints on the Growth of SMEs in a Transition Country with an Established Market Economy

  • John Hutchinson

    ()

  • Ana Xavier

In this paper we compare the role of internal finance on the growth of firms between a leading transition country, Slovenia and an established market economy, Belgium. We find that firms in Slovenia are more sensitive to internal financing constraints than their Belgian counterparts. Furthermore, we find that de novo firms and firms with long term debt are most constrained and that micro and SMES can face great difficulties in accessing external sources of finance. Foreign firms, however, are able to raise external finance and consequently their growth is less reliant on the availability of internal finance. Our findings appear to indicate that although Slovenian firms are no longer recipients of soft budget constraints, the financial environment is not yet fully functional. Copyright Springer 2006

If 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.

File URL: http://hdl.handle.net/10.1007/s11187-005-4412-3
Download Restriction: Access to full text is restricted to subscribers.

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.

Article provided by Springer in its journal Small Business Economics.

Volume (Year): 27 (2006)
Issue (Month): 2 (October)
Pages: 169-179

as
in new window

Handle: RePEc:kap:sbusec:v:27:y:2006:i:2:p:169-179
Contact details of provider: Web page: http://www.springerlink.com/link.asp?id=100338

References listed on IDEAS
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.:

as in new window
  1. Steven N. Kaplan & Luigi Zingales, 1997. "Do Investment-Cash Flow Sensitivities Provide Useful Measures of Financing Constraints?," The Quarterly Journal of Economics, Oxford University Press, vol. 112(1), pages 169-215.
  2. Harry Huizinga & Gaëtan Nicodème, 2003. "Foreign ownership and corporate income taxation : an empirical evaluation," European Economy - Economic Papers 2008 - 2015 185, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
  3. Budina, Nina & Garretsen, Harry & de Jong, Elke, 2000. "Liquidity constraints and investment in transition economies - the case of Bulgaria," Policy Research Working Paper Series 2278, The World Bank.
  4. Gérard Roland, 2004. "Transition and Economics: Politics, Markets, and Firms," MIT Press Books, The MIT Press, edition 1, volume 1, number 026268148x.
  5. Hans Degryse & Abe De Jong, 2001. "Investment Spending in the Netherlands: Asymmetric Information or Managerial Discretion?," Working Papers Department of Economics ces0114, KU Leuven, Faculty of Economics and Business, Department of Economics.
  6. Klapper, Leora & Sarria-Allende, Virginia & Sulla, Victor, 2002. "Small and medium size enterprise financing in Eastern Europe," Policy Research Working Paper Series 2933, The World Bank.
  7. Robert E. Carpenter & Bruce C. Petersen, 2002. "Is The Growth Of Small Firms Constrained By Internal Finance?," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 298-309, May.
  8. Charles J. Hadlock, 1998. "Ownership, Liquidity, and Investment," RAND Journal of Economics, The RAND Corporation, vol. 29(3), pages 487-508, Autumn.
  9. Gros, Daniel & Suhrcke, Marc, 2000. "Ten years after : what is special about transition countries?," HWWA Discussion Papers 86, Hamburg Institute of International Economics (HWWA).
  10. Griliches, Zvi & Hausman, Jerry A., 1986. "Errors in variables in panel data," Journal of Econometrics, Elsevier, vol. 31(1), pages 93-118, February.
  11. Steven M. Fazzari & R. Glenn Hubbard & BRUCE C. PETERSEN, 1988. "Financing Constraints and Corporate Investment," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(1), pages 141-206.
  12. Evans, David S., 1986. "Tests of Alternative Theories of Firm Growth," Working Papers 86-36, C.V. Starr Center for Applied Economics, New York University.
  13. Marko Simoneti & Joze P. Damijan & Matija Rojec & Boris Majcen, 2004. "Case-by-case versus Mass Privatization in Transition Economies: Owner and Seller Effects on Performance of Firms in Slovenia," LICOS Discussion Papers 14304, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  14. Jozef Konings & Marian Rizov & Hylke Vandenbussche, 2002. "Investment and Credit Constraints in Transition Economies: Micro Evidence from Poland, the Czech Republic, Bulgaria and Romania," LICOS Discussion Papers 11202, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  15. Mark Gertler & Simon Gilchrist, 1991. "Monetary Policy, Business Cycles and the Behavior of Small Manufacturing Firms," NBER Working Papers 3892, National Bureau of Economic Research, Inc.
  16. Jozef Konings & Ana Xavier, 2002. "Firm Growth and Survival in a Transition Country: Micro Evidence from Slovenia," LICOS Discussion Papers 11402, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  17. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-70, May.
  18. Fazzari, Steven M & Hubbard, R Glenn & Petersen, Bruce C, 1988. "Investment, Financing Decisions, and Tax Policy," American Economic Review, American Economic Association, vol. 78(2), pages 200-205, May.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:kap:sbusec:v:27:y:2006:i:2:p:169-179. See general 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: (Sonal Shukla)

or (Rebekah McClure)

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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.