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,...
| Main Authors: | , , |
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2002/12/2082429/small-medium-size-enterprise-financing-eastern-europe http://hdl.handle.net/10986/19200 |
| 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. |
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