EQUITY AND RATE OF RETURN: ARE SMALL MANUFACTURING FIRMS HANDICAPPED BY THEIR OWN SUCCESS?

Bernard Paranque

Finance from University Library of Munich, Germany

Abstract: From a french pannel of manufacturing firm, this article aims to show that the terms of the debate on the capitalization of small manufacturing firms ought to be clarified. These firms are often said to be undercapitalized, because in relative terms their capital spending is often similar, or even greater, than that of their larger competitors. This means that their earnings are depleted by the higher depreciation charges for maintaining their fixed assets. Undercapitalization is also due to the fact that firms in this category have poor access to capital markets.

Keywords: equity; rate of retrurn; accumulation; sme's (search for similar items in EconPapers)
JEL-codes: E5 G M2 (search for similar items in EconPapers)
Pages: 8 pages
Date: 1995-08-18, Revised 2000-10-29
Note: 8 pages, pdf
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpfi:9508002

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