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Does connectedness improve SMEs’ access to formal finance? Evidence from post-communist economies

Ruziev, Kobil; Webber, Don

Authors

Kobil Ruziev Kobil.Ruziev@uwe.ac.uk
AHOD in UG Accounting & Economics Prog Clus



Abstract

© 2018, © 2018 Informa UK Limited, trading as Taylor & Francis Group. Evidence suggests that a disproportionately greater share of formal finance is channelled to large enterprises in emerging economies, limiting the flow of appropriately-financed small and medium enterprises (SMEs). Market and information imperfections are conventionally seen as major causes of this misallocation. However, the role of political factors in affecting the distribution of formal finance has become more widely acknowledged in recent times. Our analyses of SMEs in post-communist economies also show that measures of political connectedness improve the chances of receiving bank credit and that the benefits of these links are stronger for well-established and larger SMEs.

Journal Article Type Article
Publication Date Mar 4, 2019
Journal Post-Communist Economies
Print ISSN 1463-1377
Electronic ISSN 1465-3958
Publisher Taylor & Francis (Routledge)
Peer Reviewed Peer Reviewed
Volume 31
Issue 2
Pages 258-278
APA6 Citation Ruziev, K., & Webber, D. (2019). Does connectedness improve SMEs’ access to formal finance? Evidence from post-communist economies. Post-Communist Economies, 31(2), 258-278. https://doi.org/10.1080/14631377.2018.1470855
DOI https://doi.org/10.1080/14631377.2018.1470855
Keywords financial development, formal finance, SME finance, firm-level analysis, transition economies
Publisher URL https://doi.org/10.1080/14631377.2018.1470855
Additional Information Additional Information : This is an Accepted Manuscript of an article published by Taylor & Francis in Post-Communist Economies on 13 June 2018, available online: https://doi.org/10.1080/14631377.2018.1470855