Title: The financing policy of French SMEs

Authors: Ramzi Benkraiem, Calin Gurau

Addresses: GSCM – Montpellier Business School, 2300 Avenue des Moulins, 34185 Montpellier, France. ' GSCM – Montpellier Business School, 2300 Avenue des Moulins, 34185 Montpellier, France

Abstract: This study verifies several predictions of trade-off and pecking order theories by investigating the influence of various firm characteristics on the financing policy of French SMEs. It also compares the empirical findings to those of similar studies in other countries. The evidence presented in this paper suggests that firm size, profitability, growth and tangibility of assets affect the financing policy of French SMEs in a significant way. This paper fills a gap in empirical literature by providing a level of analysis unmatched by the previous research on French SMEs. Thus, it should present useful insights for academics, professionals and policy makers.

Keywords: financing policies; firm characteristics; France; trade-off; pecking order; firm size; profitability; business growth; tangible assets; tangibility; small and medium-sized enterprises; SMEs; entrepreneurship; entrepreneurial finance.

DOI: 10.1504/IJESB.2010.034433

International Journal of Entrepreneurship and Small Business, 2010 Vol.11 No.1, pp.74 - 84

Published online: 03 Aug 2010 *

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