SMEs Capital Structure Decisions and Success Determinants: Empirical Evidence from the UAE

27 Pages Posted: 15 Jul 2017

See all articles by Sherine Farouk Abdel Al

Sherine Farouk Abdel Al

Abu Dhabi University

Fauzia Jabeen

College of Business Administration, Abu Dhabi University

Marios Katsioloudes

Qatar University - College of Business and Economics

Date Written: July 5, 2017

Abstract

The purpose of this research is to identify the capital structure decisions and the institutional factors pivotal in female owned SMEs in the United Arab Emirates. A survey questionnaire method was used to collect data from the local female entrepreneurs, and a factor analysis was conducted to understand the capital structure decisions and the institutional factors affecting SMEs success and operations. The findings revealed that the majority of the Emirati female entrepreneurs prefer internal (own savings, loans from family and friends for business startup) rather than external financing sources. UAE State Bank and international lending agencies were other popular choices for sourcing loans. They consider factors such as personnel, capital, training, government, and brand reputation will affect the success of their businesses. However, management skills and customer support factor seems to dominate. The major problem that the Emirati women entrepreneurs faced in being self-employed are efforts to manage such as too much work, responsibility, and no time for family. Business location, parking, awareness of procedural changes, and lack of clarity in policies were the dominant institutional factors that affect their business operations in the UAE. The study will help the policy makers in identifying the specific entrepreneurial factors which will lead in formulating effective and practical policy interventions in the area of capital structure and skill building of female Emirati entrepreneurs. The quantitative research provide fresh and current insights into the various issues affecting women entrepreneurs from a country that is striving hard to empower its women.

Keywords: Capital Structure, Success Factors, Institutional factors, Female, Entrepreneurship, United Arab Emirates (UAE)

JEL Classification: L26, O16, J23, M13

Suggested Citation

Farouk Abdel Al, Sherine and Jabeen, Fauzia and Katsioloudes, Marios, SMEs Capital Structure Decisions and Success Determinants: Empirical Evidence from the UAE (July 5, 2017). Journal of Accounting, Ethics and Public Policy, Vol. 18, No. 2, 2017, Available at SSRN: https://ssrn.com/abstract=2997348

Sherine Farouk Abdel Al (Contact Author)

Abu Dhabi University ( email )

Abu Dhabi

Fauzia Jabeen

College of Business Administration, Abu Dhabi University ( email )

PO Box 59911
Abu Dhabi, Abu Dhabi 59911
United Arab Emirates

HOME PAGE: http://www.adu.ac.ae

Marios Katsioloudes

Qatar University - College of Business and Economics ( email )

2713 Doha
Qatar

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