Description: Small- and Medium-Size Enterprise Financing in Eastern Europe

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Small- and Medium-Size Enterprise Financing in Eastern Europe

There is currently a large interest in understanding firms' access to finance, particularly in the financing of small- and medium-size enterprises (SMEs). But the financing patterns of SMEs across countries is not well understood. For example,...

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Bibliographic Details
Main Authors:	Klapper, Leora F., Sarria-Allende, Virginia, Sulla, Victor
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	SMALL & MEDIUM SCALE ENTERPRISES ENTERPRISE SUPPORT FINANCIAL INTERMEDIATION EQUITY FINANCE DEBT FINANCING FINANCING OPTIONS PRIVATE SECTOR TRANSITION ECONOMIES MARKET ORIENTATION PROFITABILITY GROWTH PATTERNS ACCOUNTING ACCOUNTING STANDARDS AGENCY PROBLEMS AGRICULTURE ASYMMETRIC INFORMATION AUDITORS BALANCE SHEET BALANCE SHEETS BANK LENDING BANKING SECTOR BANKING SYSTEM BANKING SYSTEMS BANKRUPTCY BASE YEAR BORROWING BUDGET CONSTRAINTS BUSINESS ENVIRONMENT COMPANY COMPETITIVENESS CONGLOMERATES CORPORATE PERFORMANCE CORPORATE STRUCTURE CORPORATIONS DEBT DOWNSIZING ECONOMIES OF SCALE EMERGING MARKETS EMPLOYMENT ENTREPRENEURS ENTREPRENEURSHIP EXPANSION EXPECTED VALUE FINANCIAL DATA FINANCIAL INSTITUTIONS FINANCIAL MARKETS FINANCIAL RATIOS FINANCIAL SECTOR FINANCIAL SERVICES FINANCIAL STRUCTURE FINANCIAL SYSTEMS FIRM SIZE FIRMS FOREIGN MARKETS FUTURE RESEARCH GDP GDP PER CAPITA GROWTH RATE HIGHLY LEVERAGED FIRMS INCOME STATEMENTS INFLATION INTEREST RATES JOB CREATION LAWS LEGAL PROTECTION LIQUIDITY LISTED COMPANIES MACROECONOMIC GROWTH MEDIUM SIZE ENTERPRISES OWNERSHIP STRUCTURE PRESENT VALUE PRIVATE CAPITAL PRIVATIZATION PRODUCTION EFFICIENCY PRODUCTIVITY REGRESSION ANALYSIS RETAINED EARNINGS RETURN ON ASSETS RETURN ON EQUITY SHAREHOLDERS SMALL FIRMS SME SME DEVELOPMENT SME SECTOR STATE ENTERPRISES STRUCTURAL CHANGE SUBSIDIARIES VENDORS WORKING CAPITAL GROWTH PATTERNS
Online Access:	http://documents.worldbank.org/curated/en/2002/12/2082429/small-medium-size-enterprise-financing-eastern-europe http://hdl.handle.net/10986/19200

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Summary:	There is currently a large interest in understanding firms' access to finance, particularly in the financing of small- and medium-size enterprises (SMEs). But the financing patterns of SMEs across countries is not well understood. For example, little is known about the relative importance of equity, debt, and inter-firm financing for SMEs across countries. The authors use the Amadeus database, which includes financial information on over 97,000 private and publicly traded firms in 15 Eastern and Central European countries. The Amadeus database allows the authors the opportunity to provide a new analysis of the general financing patterns of private firms across a large sample of Eastern European countries. The summary statistics show that the size of the SME sector (as measured by the percentage of total employment) in Eastern European countries is smaller than in most developed economies. Although the authors find in almost every country in the sample a large number of SMEs as a percentage of total firms, the SMEs in Eastern Europe are generally small and hire few employees. However, SMEs seem to constitute the most dynamic sector of the Eastern European economies, relative to large firms. In general, the SME sector comprises relatively younger, more highly leveraged, and more profitable and faster growing firms. This suggests that a new type of firm is emerging in transition economies that is more market- and profit-oriented. But at the same time, these firms appear to have financial constraints that impede their access to long-term financing and ability to grow.