دانلود رایگان مقاله تاثیر مالی مبتنی بر بازار در شکست های SME

ABSTRACT

Capital Market-Based financing for Small and Medium-sized Enterprises (SMEs) is increasingly viewed as complementary to traditional bank-based financing for SMEs. In response, policymakers are recognising the need for better access of SMEs to capital markets and are making efforts to remove major impediments to their participation in capital markets. Thus, SMEs listed on stock exchanges benefit from better access to finance and reduced information asymmetry than their unlisted counterparts. This in turn shall lead to lower failure likelihood of listed SMEs. In this study, we empirically test this hypothesis and report that listed SMEs enjoy a lower likelihood of financial distress and bankruptcy than their unlisted counterparts. Although factors affecting financial distress of both listed and unlisted SMEs are almost identical, Average Marginal Effects of respective factors are strikingly higher for their unlisted counterparts. This suggests a higher vulnerability of unlisted SMEs due to changes in financial ratios. Due to the extremely low number of legal bankruptcy events, our hypothesis finds weak support when bankruptcy is used as the dependent variable in the regression analysis. Broadly, our findings support the view that stock exchange listing can relieve SMEs from external financing constraints, thus reducing their failure likelihood.

4. Conclusion

SMEs are widely considered to be a fundamental component of an economy, and are viewed as an important route to recovery in the aftermath of the global financial crisis of 2008–2009. Given the increased importance of SMEs, a significant volume of academic literature on SMEs bankruptcy/financial distress has emerged in recent years (e.g. Altman and Sabato, 2007; Keasey et al., 2015; Gupta et al., 2017).

Access to external finance is unanimously considered to be the principal factor obstructing SMEs growth and development. This might be due to a lack of collateral and information asymmetries. Prolonged difficulty in accessing external finance may lead to financial distress or bankruptcy. Stock exchange listing could relieve SMEs from external financing constraints (Kim, 1999), consequently reducing their overdependence on banks for external financing and, thereby, reducing their likelihood of failure.

We empirically test this hypothesis using a sample of listed and unlisted SMEs located in the United States covering the sampling period between 1985 and 2016. One-year financial distress and bankruptcy prediction models of listed and unlisted SMEs are estimated using panel logistic regression technique and a set of financial covariates with established significance of financial distress/bankruptcy prediction in prior studies. The definition of financial distress employed based on firms’ financial performance is adapted from Keasey et al. (2015), and we consider a firm as bankrupt if it files for Chapter 7/11 bankruptcy.

We report significant differences between the failure risk of listed and unlisted SMEs. At any given age, the survival (hazard) likelihood of listed SMEs is significantly higher (lower) than their unlisted counterparts. In the univariate analysis, although an identical set of financial ratios is significant in discriminating between financially distressed and censored groups of listed and unlisted SMEs, we report significant differences in the weights of regression coefficients of respective covariates of listed and unlisted SMEs. AME of respective covariates for the unlisted group of firms is strikingly higher than their listed counterparts, suggesting higher vulnerability of unlisted firms due to changes in financial ratios.