Bank debt and trade credit for SMEs in Europe: firm-, industry-, and country-level determinants

Guillaume Andrieu, Raffaele Staglianò and Peter van Der Zwan ()
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Guillaume Andrieu: MRM - Montpellier Research in Management - UPVM - Université Paul-Valéry - Montpellier 3 - UPVD - Université de Perpignan Via Domitia - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School - UM - Université de Montpellier, Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School
Raffaele Staglianò: MRM - Montpellier Research in Management - UPVM - Université Paul-Valéry - Montpellier 3 - UPVD - Université de Perpignan Via Domitia - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School - UM - Université de Montpellier, Universiteit Leiden = Leiden University
Peter van Der Zwan: Erasmus University Rotterdam

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Abstract: This paper examines differences in the ability to obtain capital—bank loans and trade credit—between firms, industries, and countries using survey data on European small and medium-sized enterprises (SMEs) from 2009 to 2014. The results show that firm age and firm size are positively linked to SMEs' access to bank loans, but only firm size is positively related to the provision of trade credit. The results also provide empirical support for a complementary rather than a substitutive effect between bank loans and trade credit. Manufacturing SMEs have a significantly higher likelihood of receiving bank loans and trade credit than non-manufacturing SMEs. We find differences across countries in terms of the relevance of firm age and firm size for obtaining capital. In addition, we point at specific country-level variables that explain why obtaining credit is easier in some countries. We perform additional analyses to confirm our baseline results and provide directions for future research.

Keywords: Bank loans; Trade credit; Information asymmetry; SMEs (search for similar items in EconPapers)
Date: 2018-06
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Citations: View citations in EconPapers (28)

Published in Small Business Economics, 2018, 51 (1), pp.245-264. ⟨10.1007/s11187-017-9926-y⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02044268

DOI: 10.1007/s11187-017-9926-y

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