Bank Financing and New Venture Formation in China: Quantity vs. Quality

27 Pages Posted: 5 Jul 2012

See all articles by Iftekhar Hasan

Iftekhar Hasan

Fordham University ; Bank of Finland; University of Sydney

Nada Kobeissi

Long Island University

Haizhi Wang

Illinois Institute of Technology - Stuart School of Business

Mingming Zhou

University of Colorado, Colorado Springs - College of Business

Date Written: July 4, 2012

Abstract

In this paper, we empirically investigate the effects of bank financing on regional entrepreneurial activities in China. We present contrasting findings on the role of quantity vs. quality of bank financing on new small business formation in China: While we find a consistent, significantly positive relationship between the quality of bank financing and new venture formation, we find that the quantity of supplied credit is insignificant.

Keywords: New venture formation, Small business, Bank financing, Bank efficiency, China

JEL Classification: G21, M13

Suggested Citation

Hasan, Iftekhar and Kobeissi, Nada and Wang, Haizhi and Zhou, Mingming, Bank Financing and New Venture Formation in China: Quantity vs. Quality (July 4, 2012). Midwest Finance Association 2013 Annual Meeting Paper, Available at SSRN: https://ssrn.com/abstract=2100626 or http://dx.doi.org/10.2139/ssrn.2100626

Iftekhar Hasan

Fordham University ( email )

45 COLUMBUS AVENUE
GBA-5TH FLOOR
NEW YORK, NY 10023
United States

Bank of Finland ( email )

P.O. Box 160
Helsinki 00101
Finland

University of Sydney ( email )

P.O. Box H58
Sydney, NSW 2006
Australia

Nada Kobeissi (Contact Author)

Long Island University ( email )

720 Northern Boulevard
Brookville, 11548-1327
United States

Haizhi Wang

Illinois Institute of Technology - Stuart School of Business ( email )

Stuart Graduate School of Business
565 W. Adams St.
Chicago, IL 60661
United States

Mingming Zhou

University of Colorado, Colorado Springs - College of Business ( email )

1420 Austin Bluffs Parkway
Colorado Springs, CO 80933-7150
United States
1-719-255-5153 (Phone)

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