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Access of SMEs with growth potential to the capital markets

Author

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  • Óscar Arce
  • Elías López
  • Lucio Sanjuán

Abstract

CONTENTS: The main aim of this paper is to contribute towards the debate on how to boost the funding of newly created companies and those with high growth potential through the market and other external sources other than bank credit. The debate currently revolves around four key issues: how to ensure a sufficiently wide investor base, how to overcome possible barriers which hinder companies accessing the market, the design of markets for small and medium capitalisation securities and the role of regulation. As is to be expected, the reflections on the use of tax incentives play a significant role with regard to the first two issues. In the third issue, the debate focuses above all on how to resolve the problems of visibility which affect the markets for small and medium capitalisation securities and whether or not an exclusively national framework is sufficient for guaranteeing growth in these markets. With regard to the role of regulation, the discussion focuses on whether it would be beneficial to adapt the requirements to an “SME scale” and the impact this would have on investor protection.

Suggested Citation

  • Óscar Arce & Elías López & Lucio Sanjuán, 2011. "Access of SMEs with growth potential to the capital markets," CNMV Working Papers CNMV Working Papers no. 5, CNMV- Spanish Securities Markets Commission - Research and Statistics Department.
    • Handle: RePEc:cnv:wpaper:dt_52en
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    File URL: http://www.cnmv.es/DocPortal/Publicaciones/MONOGRAFIAS/N52_ENen.pdf
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    References listed on IDEAS

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    1. 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.
    2. 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, vol. 13(2), pages 187-221, June.
    3. Cassar, Gavin, 2004. "The financing of business start-ups," Journal of Business Venturing, Elsevier, vol. 19(2), pages 261-283, March.
    4. Bernanke, Ben & Gertler, Mark, 1989. "Agency Costs, Net Worth, and Business Fluctuations," American Economic Review, American Economic Association, vol. 79(1), pages 14-31, March.
    5. 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.
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    Cited by:

    1. Aljosa Sestanovic, 2015. "SME Stock Exchanges – Should They Have a Greater Role?," Effectus - Working Paper Series 0008, Effectus - University College for Law and Finance.
    2. Aljosa Sestanovic, 2015. "SME Stock Exchanges - Should They Have a Greater Role?," FIP - Journal of Finance and Law, Effectus - University College for Law and Finance, vol. 4(1), pages 59-74.

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