TY - JOUR
T1 - Finance and Growth for Microenterprises: Evidence from Rural China
AU - Beck, T.
AU - Lu, L.
AU - Yang, R.
N1 - PT: J; NR: 40; TC: 0; J9: WORLD DEV; PG: 19; GA: CA0PT; UT: WOS:000348620000004
PY - 2015
Y1 - 2015
N2 - Using a survey dataset of Chinese rural households, we find that access to external finance is positively associated with the decision to become entrepreneur and the initial investment for microenterprises. Also, we find that use of informal finance, especially financing from friends and family, is positively associated with sales growth of microenterprises with employees, but not of self-employed. We do not find any significant relationship between the use of formal finance and firm growth. Our findings underline the importance of finance for entrepreneurship and microenterprise growth, and the role of informal finance in the absence of efficient formal financial institutions.
AB - Using a survey dataset of Chinese rural households, we find that access to external finance is positively associated with the decision to become entrepreneur and the initial investment for microenterprises. Also, we find that use of informal finance, especially financing from friends and family, is positively associated with sales growth of microenterprises with employees, but not of self-employed. We do not find any significant relationship between the use of formal finance and firm growth. Our findings underline the importance of finance for entrepreneurship and microenterprise growth, and the role of informal finance in the absence of efficient formal financial institutions.
UR - https://www.scopus.com/pages/publications/84908635567
UR - https://www.scopus.com/inward/citedby.url?scp=84908635567&partnerID=8YFLogxK
U2 - 10.1016/j.worlddev.2014.10.008
DO - 10.1016/j.worlddev.2014.10.008
M3 - Article
SN - 0305-750X
VL - 67
SP - 38
EP - 56
JO - World Development
JF - World Development
ER -
