Paper
The Determinants of Financing Obstacles
How does one distinguish between financially constrained and unconstrained firms?
36 pages
The paper uses survey data on a sample of over 10,000 firms from 80 countries to assess:
- How successful a priori classifications are in distinguishing between financially constrained and unconstrained firms, and;
- More generally, the determinants of financing obstacles of firms.
It finds that older, larger, and foreign-owned firms report less financing obstacles. The findings thus confirm the usefulness of size, age and ownership as a priori classifications of financing constraints, while they shed doubts on other classifications used in the literature.
The results also suggest that institutional development is the most important country characteristic explaining cross-country variation in firms' financing obstacles.
[From the Author's Abstract]
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