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Rural Small Business Finance - Evidence from the 1998 Survey of Small Business Finances

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  • Gustafson, Cole R.

Abstract

The 1998 Survey of Small Business Finances provides robust information on the financing of small businesses including an overview of their firm’s organization, financial characteristics, and credit use. Information from the survey is used in this study to compare the financial characteristics of metro and rural small businesses. While many financial characteristics are similar, rural small businesses do own more land and depreciable assets, and have lower inventory and other current assets when compared with urban firms. Rural firms have relatively similar access to technology and financial services, although utilization varies. Both metro and rural small businesses rely on a wide variety of sources for financing, although rural small businesses have significantly more mortgages, loans from shareholders, and other types of loans, but fewer credit cards. Nonparametric rank order statistical methods were required because normality assumptions were violated due to asymmetric distribution of small firms.

Suggested Citation

  • Gustafson, Cole R., 2003. "Rural Small Business Finance - Evidence from the 1998 Survey of Small Business Finances," 2003 Regional Committee NCT-194, October 6-7, 2003; Kansas City, Missouri 132517, Regional Research Committee NC-1014: Agricultural and Rural Finance Markets in Transition.
  • Handle: RePEc:ags:nc2003:132517
    DOI: 10.22004/ag.econ.132517
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    1. Marianne Bitler & Alicia M. Robb & John D. Wolken, 2001. "Financial services used by small businesses: evidence from the 1998 survey of small business finances," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), vol. 87(Apr), pages 183-205, April.
    2. Edelman, Mark A., Dr., 1997. "The Adequacy of Rural Capital Markets: Public Purpose and Policy Options," ISU General Staff Papers 199709040700001292, Iowa State University, Department of Economics.
    3. Holmes, Marionette & Park, Timothy A., 2000. "Portfolio Decisions Of Small Agribusinesses: Evidence From The 1993 National Survey Of Small Business Finance," 2000 Annual meeting, July 30-August 2, Tampa, FL 21848, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
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