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Access to Credit and Investment Decisions of Small and Medium-Sized Enterprises in China: Size Matters

Listed author(s):
  • Regis, Paulo José

    ()

    (Division of Economics, Xi'an Jiaotong-Liverpool University)

Financial constraints are common in developing countries where financial systems are underdeveloped. In China, firms report that access to finance is the most important obstacle in the business environment. This is related to firms that fail to gain access to the credit market. We examine the likelihood of gaining access to credit by firms, and find that size and exporting appear to be the key characteristics. Credit constraints are significant for investment decisions. Together with size, access to credit is among the firm characteristics with the greatest impact on the likelihood to invest.

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File URL: http://58.210.89.21/RePEc/xjt/working-papers/RIEI-WP_2015-01.pdf
File Function: Revised version, 2016
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Paper provided by Xi'an Jiaotong-Liverpool University, Research Institute for Economic Integration in its series RIEI Working Papers with number 2015-01.

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Length: 26 pages
Date of creation: 03 Aug 2015
Date of revision: 14 Jun 2016
Handle: RePEc:xjt:rieiwp:2015-01
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