Bank Financing and New Venture Formation in China: Quantity vs. Quality
27 Pages Posted: 5 Jul 2012
Date Written: July 4, 2012
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
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