SME Steeplechase: When Obtaining Money Is Harder Than Innovating

Guercio, Maria; Martínez, Lisana B.; Bariviera, Aurelio F.

doi:10.3390/ijfs7020025

Cited by 8 publications

(5 citation statements)

References 39 publications

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“…In addition, a deterioration in a firms’ own view of their credit history, own economic outlook and own capital should reduce their access to finance (Aristei & Gallo, 2022 ; Calabrese et al, 2021 ; Moro et al, 2020 ). The literature also indicates that firms that engage in innovation face more credit constraints due to the uncertainty associated with this activity (Acharya & Xu, 2017 ; Bańkowska et al, 2020 ; Brown et al, 2022 ; Guercio et al, 2019 ; Moro et al, 2020 ; Santos & Cincera, 2022 ). A statistically significant and negative (positive) result in the interaction of monetary policy and firm risk would suggest that the implementation of UMP reduces (increases) the probability of risky firms being credit constrained.…”

Section: Data and Empirical Methodologymentioning

confidence: 99%

ECB unconventional monetary policy and SME access to finance

Finnegan

Kapoor

2023

Small Bus Econ

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Small- and medium-sized enterprises (SMEs) account for two-thirds of employment in the euro area which makes them a priority for the transmission of monetary policy to the real economy. SMEs in Europe experienced a credit crunch following the sovereign debt crisis. Over the period 2014–2019, the European Central Bank (ECB) engaged in unconventional monetary policy (UMP) to restore funding conditions in the euro area, to support stronger economic growth and higher inflation. We use the ECB/EC Survey on the Access to Finance of Enterprises to examine the relationship between monetary policy and SME access to finance in countries that were most affected by the crisis as follows: Greece, Ireland, Italy, Portugal and Spain. We show that the implementation of UMP increases the probability that firms with higher debt-to-assets ratio remain credit constrained in stressed countries, although this effect becomes insignificant in non-stressed countries. Our findings suggest that monetary policy is transmitted unevenly to leveraged SMEs across jurisdictions. Additionally, we find little evidence that risky firms are credit constrained during periods of UMP, when risk is measured from the firms’ own viewpoint. However, our heterogenous analysis shows that smaller and younger firms—which are also considered to be risky—remain credit constrained over this period. Policy should ensure that UMP trickles down to SMEs regardless of their size, age or location. Tweetable line: Leveraged SMEs in stressed countries are more likely to remain credit constrained even when monetary policy is expansionary. Policy must do more to support small and young firms’ access to credit to facilitate higher investment and growth.

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Section: Data and Empirical Methodologymentioning

confidence: 99%

ECB unconventional monetary policy and SME access to finance

Finnegan

Kapoor

2023

Small Bus Econ

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“…They consider access to finance to be an important determinant for developing technological infrastructure and providing the necessary level of innovation performance, which would ensure development of companies and their survival in challenging competitive conditions. Guercio et al (2019) examined main determinants of European SMEs related to demand and access to external sources of finance. They used data from extensive databases of the European Central Bank and the European Commission.…”

Section: Literature Reviewmentioning

confidence: 99%

Availability of human capital and the development of the public infrastructure in the context of business activities of SMEs

Belás¹,

Kmecová²,

Čepel³

2020

RAMP

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The paper´s objective is to define significant technological factors in the areas of human capital availability and research and development affecting the quality of small and medium-sized enterprises (SMEs) and their business environment, and to quantify differences between the Czech Republic (CR) and the Slovak Republic (SR). Based on the objective, empirical research was conducted including data from 312 SMEs in the CR and 329 SMEs in the SR processed with the use of Chi-squared tests and Z-scores. The research showed differences in assessing defined technological factors between the CR and the SR, and also confirmed a low level of the assessed factors in both countries. Furthermore, overall satisfaction with the quality of secondary schools and universities is relatively low despite the fact that the research showed a higher level of satisfaction with the quality of university education in both countries. In the Czech Republic, entrepreneurs largely experience a shortage of skilled workforce, with this factor achieving the highest negative rating. The Slovak entrepreneurs most negatively assessed the level of state support of research and development. Moreover, the entrepreneurs´ overall level of satisfaction with the research and development infrastructure is relatively low, since only 23.08% of the Czech and 13.68% of the Slovak entrepreneurs agreed that the infrastructure is well built in their respective country. Similar results were also obtained in assessing state support of research and development. At the same time, it was found that research and development results help the entrepreneurs only to a limited extent, and the entrepreneurs in both countries are not very optimistic about future development of their business activities.

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“…More recently, Galli et al (2018) report that the owner firms ‘gender are correlated with the financial access. Lastly, Guercio et al (2019) found that innovation is an additional limitation to access to finance.…”

Section: What Has Been Done With Safe Survey?mentioning

confidence: 99%

“…During the year 2019, seven papers have been published. One of them is the work by Guercio et al (2019) who analyse the main characteristics of European SMEs associated to the demand for and access to external financial resources. They find that firms characteristics like size and innovative activities influence not only the access to, but also the demand for external finance.…”

Section: What Has Been Done With Safe Survey?mentioning

confidence: 99%

A meta‐analysis of SMEs literature based on the survey on access to finance of enterprises of the European central bank

2020

Self Cite

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Small and Medium Enterprises (SMEs) are substantial contributors to employment and to the GDP growth in many countries. Therefore, understanding their difficulties to find appropriate financial resources are a key task for policy makers. Despite being a long-debated topic, there are still several gaps in the literature, probably due to the lack of empirical data. A relatively new database, the Survey of Access to Finance of Enterprises (SAFE) emerged after the subprime crisis. It is regularly conducted by the European Central Bank and can provide new information on SMEs financing. This paper conducts a metaanalysis of the literature based upon this survey, identifying key working hypothesis, methodologies and results.

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SME Steeplechase: When Obtaining Money Is Harder Than Innovating

Cited by 8 publications

References 39 publications

ECB unconventional monetary policy and SME access to finance

ECB unconventional monetary policy and SME access to finance

Availability of human capital and the development of the public infrastructure in the context of business activities of SMEs

A meta‐analysis of SMEs literature based on the survey on access to finance of enterprises of the European central bank

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