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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/26950
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| Title: | Where Does the Money Come From? The Financing of Small Entrepreneurial Enterprises |
| Authors: | Fluck, Zsuzsanna
Holtz-Eakin, Douglas
Rosen, Harvey S. |
| Issue Date: | Feb-1998 |
| Series/Report no.: | FIN-98-038 |
| Abstract: | Using data from the Wisconsin Entrepreneurial Climate Study, we study
the sources of firms' finance during the very early stages of their
lives. Our focus is the evolution of the mix of financial capital from
'insiders' and 'outsiders' as firms age. We find that at the beginning
of firms' life cycles, the proportion of funds form internal sources
increases with age, while the proportion from banks, venture
capitalists, and private investors declines. There is also evidence that
these patterns eventually reverse themselves, with the proportion of
insider finance ultimately declining and the proportion of outsider
finance increasing with age. We argue that these findings are consistent
with elements of both reputation-based and monopoly-lender theories of
firm finance. |
| URI: | http://hdl.handle.net/2451/26950 |
| Appears in Collections: | Economics Working Papers
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