Financing Micro Firms in Europe: An Empirical Analysis

Arbeitspapier

The vast majority of firms in Europe are micro firms. Still, we know little about their financing patterns. Our paper aims to close this gap. Based on a large European firm-level data set, we find that micro firms differ in their financing patterns from small and medium-sized companies. Our empirical results show that micro firms are more likely to use internal financing instruments, whereas they are less likely to use state subsidies, trade credit or asset-based financing instruments. Furthermore, micro firms differ from medium-sized firms by using more short-term debt (credit card overdrafts, credit lines and bank overdrafts). The implications of these findings for micro firms and policy makers are discussed.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: EIF Working Paper ; No. 2017/44

Classification and Topics

• Classification: Wirtschaft ; Multiple or Simultaneous Equation Models; Multiple Variables: General ; Financial Institutions and Services: General ; Corporate Finance and Governance: General
• Subject: Micro firms ; SMEs ; enterprise financing in Europe ; financing patterns

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Masiak, Christian ; Block, Joern H. ; Moritz, Alexandra ; Lang, Frank ; Kraemer-Eis, Helmut
• Event: Veröffentlichung
• (who): European Investment Fund (EIF)
• (where): Luxembourg
• (when): 2017

Further information

• Handle: http://hdl.handle.net/10419/176674
• Last update: 10.03.2025, 11:46 AM CET