The Impact of Human and Social Capital on Entrepreneurs’ Knowledge of Finance Alternatives
Journal of Small Business Management, Forthcoming
Posted: 9 Jan 2011
Date Written: January 8, 2011
Building upon prior research that demonstrates how the limited knowledge of finance alternatives of entrepreneurs may cause suboptimal finance decisions, this paper examines how entrepreneurs’ human and social capital influence their knowledge of finance alternatives. For this purpose, we use survey data from 103 Belgian start-ups. Results demonstrate that entrepreneurs with a business education and entrepreneurs with experience in accountancy or finance have a broader knowledge of finance alternatives. Having a strong network in the financial community is further positively associated with the knowledge of finance alternatives. However, generic human capital, including higher education, industry experience and management experience, is almost not related with the knowledge of finance alternatives.
Keywords: Enterpreneur, Human Capital, Knowledge, Finance, Startup
JEL Classification: G32, M13
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