The impact of exporting on SME capital structure and debt maturity choices

Elisabeth Maes (), Nico Dewaelheyns, Catherine Fuss and Cynthia Van Hulle ()
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Elisabeth Maes: KULeuven, Faculty of Economics and Business, Department of Accountancy, Finance and Insurance
Cynthia Van Hulle: KULeuven, Faculty of Economics and Business, Department of Accountancy, Finance and Insurance

No 311, Working Paper Research from National Bank of Belgium

Abstract: Using a longitudinal dataset comprising of detailed financial and exporting data from Belgian small and medium-sized enterprises (SME) between 1998 and 2013, this article examines the manner in which firms manage to finance their export activities and the resulting impact on corporate capital structure. We find that exporters have to finance relatively more working capital as compared to their non-exporting peers and that they resolve this financing need by carrying more short-term debt. In addition, we evidence that the relationship between pledgeable short-term assets, such as working capital, and short-term debt financing is more pronounced for exporters. In particular, we show that the ties between pledgeable short-term assets and short-term debt financing are stronger for export-intensive firms and firms that serve distant and risky export destinations. Overall, what our empirical findings seem to suggest is that developing tools that facilitate the pledging of assets is likely to boost SME export activities by widening access to bank financing and reducing financial constraints.

Keywords: SMEs; capital structure; debt maturity; export; collateral; working capital (search for similar items in EconPapers)
JEL-codes: F10 F14 F42 G3 G32 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2016-10
New Economics Papers: this item is included in nep-cfn, nep-int and nep-sbm
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:nbb:reswpp:201610-311

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