Abstract

http://ssrn.com/abstract=1506374
 
 

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The Economics of Small Business Finance: The Role of Private Equity and Debt Markets in the Financial Growth Cycle


Allen N. Berger


University of South Carolina - Moore School of Business; Wharton Financial Institutions Center; Tilburg University - CentER

Gregory F. Udell


Indiana University Bloomington - Department of Finance

1998

University of Illinois at Urbana-Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship

Abstract:     
While large firms are financed through public, visible institutions such as the stock market, private firms are financed through less visible, information scarce means – e.g., private equity or debt financing. At different points in a firm's financial growth cycle – at different stages of firm size and age – forms of financing will vary. This analysis reviews the literature on small firm finance, discusses macroeconomic and public policy implications, and identifies a research agenda. Newly available data sources on small business finance, especially for the United States, are discussed. These new tools allow empirical testing of previous theories, resulting in changes in previous thought about such issues as the role of insider vs external sources of finance. The authors note that sources of finance are interconnected and complementary.

Keywords: Credit rationing, Growth cycle, Venture capital, Firm financing, Private equity, Debt financing, Banking industry, Economic research, Datasets, Capital structure

Accepted Paper Series


Not Available For Download

Date posted: November 17, 2009  

Suggested Citation

Berger, Allen N. and Udell, Gregory F., The Economics of Small Business Finance: The Role of Private Equity and Debt Markets in the Financial Growth Cycle (1998). Journal of Banking & Finance, Vol. 22, Issue 6-8, p. 613-673 1998. Available at SSRN: http://ssrn.com/abstract=1506374

Contact Information

Allen N. Berger (Contact Author)
University of South Carolina - Moore School of Business ( email )
1705 College St
Francis M. Hipp Building
Columbia, SC 29208
United States
803-576-8440 (Phone)
803-777-6876 (Fax)
Wharton Financial Institutions Center
Philadelphia, PA 19104-6367
United States
Tilburg University - CentER
P.O. Box 90153
Tilburg, DC 5000 LE
Netherlands
Gregory F. Udell
Indiana University Bloomington - Department of Finance ( email )
1309 E. 10th St.
Bloomington, IN 47405
United States
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