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The International Evidence on Discouraged Small Businesses

  • Sugato Chakravarty

    ()

    (Purdue University)

  • Meifang Xiang

    ()

    (University of Wisconsin-Whitewater)

We use a unique firm-level survey database compiled by the World Bank to examine the drivers of discouraged small businesses in various developing economies around the world. We confirm that older and larger firms are less likely to be discouraged and that the level of competition and the relationships of the firms with banks have a significant impact on the probability of a firm in being discouraged. Further analysis suggests that the drivers of borrower discouragement might work differently for firms operating in relatively developed versus underdeveloped economies.

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Paper provided by Purdue University, Department of Consumer Sciences in its series Working Papers with number 1013.

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Length: 52 pages
Date of creation: Sep 2012
Date of revision:
Publication status: forthcoming paper in the Journal of Empirical Finance
Handle: RePEc:csr:wpaper:1013
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