Firms' Financing Constraints: Do Perceptions Match the Actual Situation?

55 Pages Posted: 25 Aug 2013

See all articles by Annalisa Ferrando

Annalisa Ferrando

European Central Bank (ECB)

Klaas Mulier

Ghent University - Faculty of Economics and Business Administration

Date Written: August 5, 2013

Abstract

This paper uses a non-parametric matching procedure to match survey replies to balance sheet information. It draws on the SAFE survey on access to finance for a sample of 11886 firms in the euro area which are matched with their nearest neighbor in an extended dataset with balance sheet information on 2.3 million firms. We investigate the role of firm characteristics with respect to the experience of facing financing obstacles in the period 2009-2011. We distinguish between firms' perceived financing constraints and actual financing constraints. We find that more protable firms are less likely to face actual financing constraints. Also firms with more working capital and lower leverage ratios are less likely to be actually financially constrained, however profitability measures seem to be more robust. Firms are more likely to perceive access to finance problematic when they have more debt with short term maturity. Finally, firm age, but not size, is important in explaining both the perceived and the actual financial constraints.

Keywords: SMEs, financial constraints, survey data, statistical matching of data

JEL Classification: E22, G30, G10, O16, K40

Suggested Citation

Ferrando, Annalisa and Mulier, Klaas, Firms' Financing Constraints: Do Perceptions Match the Actual Situation? (August 5, 2013). ECB Working Paper No. 1577. Available at SSRN: https://ssrn.com/abstract=2305940

Annalisa Ferrando (Contact Author)

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

Klaas Mulier

Ghent University - Faculty of Economics and Business Administration ( email )

Ghent, B-9000
Belgium

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