Banking Consolidation and Small Firm Financing for Research and Development

Andrew C. Chang
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Andrew C. Chang: https://www.federalreserve.gov/econres/andrew-c-chang.htm

No 2016-029, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: This paper examines the effect of increased market concentration of the banking industry caused by the Riegle-Neal Interstate Banking and Branching Efficiency Act (IBBEA) on the availability of finance for small firms engaged in research and development (R&D). I measure the financing decisions of these small firms using a balanced panel of Small Business Innovation Research (SBIR) applications. Using difference-in-differences, I find IBBEA decreased the supply of finance for small R&D firms. This effect is larger for late adopters of IBBEA, which tended to be states with stronger small banking sectors pre-IBBEA.

Keywords: Banking Deregulation; IBBEA; Interstate Bank Branching Deregulation; Market Concentration; Research and Development; Riegle-Neal; Small Business Innovation Research (search for similar items in EconPapers)
JEL-codes: G21 G28 G39 O30 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2016-04-08
New Economics Papers: this item is included in nep-bec, nep-cfn, nep-com, nep-cse, nep-ent, nep-ino, nep-pke and nep-sbm
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfe:2016-29

DOI: 10.17016/FEDS.2016.029

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