Entrepreneurs must experiment to learn how good they are at a new activity. What happens when the experimentation is financed by a lender? Under common scenarios, i.e., when there is the opportunity to learn by "starting small" or when "noncompete" clauses cannot be enforced ex post, we show...

In the wake of the 2008 financial crisis, there has been increased focus on access to finance for small firms. Research from before the crisis suggested that it was harder for innovative firms to access finance. Yet no research has considered the differential effect of the crisis on innovative...

Private firms' ability to communicate confidentially with selected investors implies that valuation disagreements between firms and investors are larger at public firms than at private ones. Consistent with the notion that misvaluation concerns lead public firms to hoard cash to be able to...

The present report is a case study on crowdfunding as a finance instrument for SMEs and entrepreneurs. The report aims to examine the characteristics, diffusion and uptake by new firms and existing SMEs, assessing its effectiveness in supporting innovative or potentially high-growth firms to...

The 2008-09 global financial crisis had a profound impact on the availability of bank credit for SMEs. Although a decline in the demand for bank credit played an important role, banks have also become more reluctant to lend, including as a consequence of new capital requirements. Moreover, a...

This report identifies effective approaches adopted by countries to implement the G20/OECD High-Level Principles on SME Financing, welcomed by the G20 Leaders at their Antalya Summit in 2015. It draws on participating countries’ replies to dedicated surveys. In total, 40 countries participated...

The present report analyses the extent to which capital markets have provided capital to SMEs since the GFC, focusing on three kinds of financial instruments that have proven especially important in providing finance to SMEs undergoing major transitions during the past few years: Private Equity;...

The document sets out how intangible assets can be relevant for SMEs to obtain external funding; the challenges and opportunities in this area; and the rationale for policy intervention. It provides some policy trends from a selected group of countries and concludes with some issues to be...

I develop a highly tractable general equilibrium model in which heterogeneous producers face collateral constraints, and study the effect of financial frictions on capital misallocation and aggregate productivity. My economy is isomorphic to a Solow model but with time-varying TFP. I argue that...

We exploit Medicare national coverage reimbursement approvals of medical devices as a quasi-natural experiment to investigate how private and publicly traded firm financing decisions and product introductions respond to exogenous changes in investment opportunities. We find that publicly traded...