Finance and Firm Start-Up Size: Quantile Regression Evidence from China

Univ. of Nottingham Research Paper No. 2009/12

24 Pages Posted: 13 Aug 2009

See all articles by Jun Du

Jun Du

Aston University, Aston Business School, Economics and Strategy

Sourafel Girma

Nottingham University Business School

Date Written: June 1, 2009

Abstract

Using a unique dataset which provides information on the financial structure of start-up companies in the Chinese manufacturing industry, this paper documents robust evidence that access to formal financing channels has beneficial effects on firm size, these effects being more marked as we move up the entry size distribution. By contrast we find negative relationships between informal finance and entry size across all size quantiles. Given the well-documented positive correlations between firm size and numerous performance indicators, this paper has therefore uncovered entry size as an additional channel through which financial development promotes growth.

Keywords: China, finance, growth

JEL Classification: O5 G2

Suggested Citation

Du, Jun and Girma, Sourafel, Finance and Firm Start-Up Size: Quantile Regression Evidence from China (June 1, 2009). Univ. of Nottingham Research Paper No. 2009/12. Available at SSRN: https://ssrn.com/abstract=1448570 or http://dx.doi.org/10.2139/ssrn.1448570

Jun Du (Contact Author)

Aston University, Aston Business School, Economics and Strategy ( email )

Aston Triangle
Birmingham, B4 7ET
United Kingdom
004401212043340 (Phone)

HOME PAGE: http://www.abs.aston.ac.uk/newweb/staff/detail.asp/sfldStaffID=A0000717

Sourafel Girma

Nottingham University Business School ( email )

Jubilee Campus
Nottingham, NG8 1BB
United Kingdom
+44 0 115 8466656 (Phone)

HOME PAGE: http://www.nottingham.ac.uk/~lizsmg/

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