South African firm-level evidence of the links between finance and efficiency
Small and medium-sized enterprises are often seen as drivers of economic growth and development by generating employment opportunities. However, for SMEs to be successful they need finance. Access to finance has been found to be a major obstacle to SMEs’ ability to do business in South Africa. This...
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doaj-6cfd2dcfc0db4ffca12063ba8e0579c12021-02-02T07:51:30ZengAOSISJournal of Economic and Financial Sciences1995-70762312-28032012-04-015127128610.4102/jef.v5i1.317258South African firm-level evidence of the links between finance and efficiencyWaldo Krugell0Marianne Matthee1School of Economics, North West UniversitySchool of Economics, North West UniversitySmall and medium-sized enterprises are often seen as drivers of economic growth and development by generating employment opportunities. However, for SMEs to be successful they need finance. Access to finance has been found to be a major obstacle to SMEs’ ability to do business in South Africa. This paper takes a closer look at firms, their access to finance and output per worker in South Africa, by using data from the World Bank Enterprise Survey 2007. The results show that firms that are financially constrained are more vulnerable to shocks and competition, and are weaker contributors to employment creation and growth. These firms are typically small and less established. They hold less inventory, have lower capacity utilisation and are unlikely to be exporters or to introduce new products in response to competition. The results from the regression model confirm that access to finance and different sources of finance are drivers of productivity at firm level.https://jefjournal.org.za/index.php/jef/article/view/317efficiencyfinanceaccess to financesources of financesmall and medium enterprisesSouth Africa |
collection |
DOAJ |
language |
English |
format |
Article |
sources |
DOAJ |
author |
Waldo Krugell Marianne Matthee |
spellingShingle |
Waldo Krugell Marianne Matthee South African firm-level evidence of the links between finance and efficiency Journal of Economic and Financial Sciences efficiency finance access to finance sources of finance small and medium enterprises South Africa |
author_facet |
Waldo Krugell Marianne Matthee |
author_sort |
Waldo Krugell |
title |
South African firm-level evidence of the links between finance and efficiency |
title_short |
South African firm-level evidence of the links between finance and efficiency |
title_full |
South African firm-level evidence of the links between finance and efficiency |
title_fullStr |
South African firm-level evidence of the links between finance and efficiency |
title_full_unstemmed |
South African firm-level evidence of the links between finance and efficiency |
title_sort |
south african firm-level evidence of the links between finance and efficiency |
publisher |
AOSIS |
series |
Journal of Economic and Financial Sciences |
issn |
1995-7076 2312-2803 |
publishDate |
2012-04-01 |
description |
Small and medium-sized enterprises are often seen as drivers of economic growth and development by generating employment opportunities. However, for SMEs to be successful they need finance. Access to finance has been found to be a major obstacle to SMEs’ ability to do business in South Africa. This paper takes a closer look at firms, their access to finance and output per worker in South Africa, by using data from the World Bank Enterprise Survey 2007. The results show that firms that are financially constrained are more vulnerable to shocks and competition, and are weaker contributors to employment creation and growth. These firms are typically small and less established. They hold less inventory, have lower capacity utilisation and are unlikely to be exporters or to introduce new products in response to competition. The results from the regression model confirm that access to finance and different sources of finance are drivers of productivity at firm level. |
topic |
efficiency finance access to finance sources of finance small and medium enterprises South Africa |
url |
https://jefjournal.org.za/index.php/jef/article/view/317 |
work_keys_str_mv |
AT waldokrugell southafricanfirmlevelevidenceofthelinksbetweenfinanceandefficiency AT mariannematthee southafricanfirmlevelevidenceofthelinksbetweenfinanceandefficiency |
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1724298413454917632 |