Resourcing Small and Medium Sized Enterprises: A Financial Growth Life Cycle Approach

ISBN-13: 9783790823981 / Angielski / Twarda / 2010 / 210 str.

Ciaran Mac an Bhaird

Opis

In a world of increasing financial uncertainty and growing unemployment, the macroeconomic contribution of SMEs is more important than ever. Development of a vibrant, sustainable small firm sector is dependent on sufficient resourcing of SMEs, particularly adequate capitalisation. This book provides a timely examination of SME financing and determinants of capital structure. A special feature of this book is the novel methodological approach adopted, providing an innovative perspective on SME financing. Analysis of stated financing preferences and objectives of SME owners is combined with results of statistical analysis of firm characteristics in exploring holistic explanations for observed capital structures. The uniqueness of this approach is in the contribution of data on financing preferences to supplement and contextualise results of bivariate and multivariate statistical tests. This methodology extends the SME literature, and is of interest to academics, researchers, practitioners and policy makers.

Spis treści

1. The role of SMEs in Western economies * Introduction * Definitions in SME financing research * Emergence of the research subject * Previous research on financing Irish SMEs * Sources of external finance available to Irish SMEs * Conclusion * 2. SME financing: A life cycle approach * Introduction * Life cycle theory of the firm * Application of the life cycle approach to the SME sector * Empirical examination of the financial growth life cycle model * Distribution of debt and equity across age groups * One-way Anova post-hoc analysis * Comparison of sources of finance employed at start-up and at present * Data on the provision of collateral by respondents * Distribution of collateral provision across age groups * Comparison of collateral provision at start-up and at present * Conclusions * 3. SME financing: Investigation of firm and industry effects * Introduction * Description of variables employed in multivariate models * Summary descriptive data of dependent variables * Summary descriptive data of independent variables * Tests for multicollinearity * Multivariate regression results * Examining statistical significance * Heteroskedasticity * Investigation of sectoral effects * Results of seemingly unrelated regression models * Conclusions * 4. SME owners’ financing preferences * Introduction * Respondents’ financing preferences * External financing requirement * Perceived availability of finance * Perceived internal growth constraints * Explanations for respondents’ financing preferences * Control and managerial independence * Perception of funders and their requirements * Financial objectives * Respondents’ considerations whenraising external finance * Considerations when raising debt * Considerations when raising external equity * Exploration of signalling, trade-off, and timing theories * Respondents’ views on signalling effects * Respondents’ views on debt-tax shield benefits of debt * Respondents’ views on timing considerations * Conclusion * 5. Discussion and conclusions * Introduction * Discussion of results * Asymmetric information and signalling theories * Agency theory * Trade-off theory * Implications for future research * Policy implications * Implications for SME firm owners * Implications for funders * Findings in relation to initial research objectives * Firm characteristics * Owner preferences * The financial growth life cycle model * References * Appendix A Research methodology and profile of respondents * Introduction * Data collection * Selection of the sample frame * Development of the questionnaire instrument * Elements incorporated to improve response rate * Piloting and testing the questionnaire instrument * Profile of respondents * Age profile of respondents * Sectoral profile of respondents * Size profile of respondents * Respondents’ expenditure on research and development * Export activity of respondents * Supporting tables presenting results of crosstabulations, chi-square tests, and directional measures. * Appendix B Previous related literature * Introduction * The Modigliani and Miller propositions * Static trade-off theory * Application of trade-off theory to the SME sector * Asymmetric information and signalling theories * Application of asymmetric information and signalling theories to the SME sector