Debt Costs Determinants in Small Enterprise

Michalski, Grzegorz

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Debt Costs Determinants in Small Enterprise

Uwarunkowania rynkowe rozwoju mikro i małych przedsiębiorstw, A. Bielawska, ed., pp. 465-471, 2006

9 Pages Posted: 16 Aug 2007

See all articles by Grzegorz Michalski

Grzegorz Michalski

Technical University in Košice (TUKE); Uniwersytet Ekonomiczny we Wrocławiu - Faculty of Engineering and Economics

Abstract

The cost of debt for small enterprises is higher than for other enterprises. The article explains why the cost of debt for small business is higher than for other firms. It is a result of specific characteristics of small enterprises. First of all, the small enterprises are more risky than other firms. Next, in small enterprises, agency costs and information asymetry are different than in other firms. All of them cause, the growing of the cost of debt for small enterprises.

Note: Downloadable document is in Polish.

Keywords: Value of liquidity, kost of debt, Value based management, Demand for Liquidity, agency costs, Risk, Uncertainty

JEL Classification: G39, G32, G11, M11, D81, O16, P33, P34

Suggested Citation: Suggested Citation

Michalski, Grzegorz and Michalski, Grzegorz, Debt Costs Determinants in Small Enterprise. Uwarunkowania rynkowe rozwoju mikro i małych przedsiębiorstw, A. Bielawska, ed., pp. 465-471, 2006, Available at SSRN: https://ssrn.com/abstract=1007383