Study on Small and Medium-Sized Enterprises in Italy: The Relationship With the Banking System and Financial Structure Choices (original) (raw)

Credit Rationing and the Financial Structure of Italian Small and Medium Enterprises

SSRN Electronic Journal, 2000

Our aim is to analyze the effect of public subsidies on the development path of Italian small and medium enterprises (SMEs). Public subsidies to SMEs have been often used with the aim of favoring economic growth in less developed regions. The main theoretical arguments justifying this intervention are related to the idea that public subsidies can solve lack-ofcapital problems deriving from asymmetric information. According to , public subsidies to rationed firms can reduce the informational gap, leading subsidized firms to reduce their financial constraints and to increase their investment levels. Results obtained modelling leverage, performance and investment behaviour in a panel of around 1,900 enterprises over the years 1989 to 1994 seem to confirm the working hypotheses. However, they can not be considered as conclusive and further research is needed in this context. JEL classification codes: C33, D21, D82

SMES' ACCESS TO FINANCE: AN OVERVIEW FROM SOUTHERN ITALY

European Journal of Business and Social Sciences, 2014

In EU, despite Small and Medium Enterprises (SMEs) have a significant impact to the economy, they haven't adequate attention. Particularly, various researchers have focused their attention on larger and listed firms. This study aims to investigate the access to finance of SME. Access to finance is a key for business start-up, development and growth for SMEs, and they have very different needs and face different challenges with regard to financing compared to large businesses. The lack of equity invested in small firms makes these enterprise more dependent on other sources such as bank lending and other types of financial products. This paper describe the different ways to finance SMEs. The limitations of the paper are the result of its very nature: it is a largely conceptual paper. Empirical research is therefore needed to test and validate the essentially preliminary framework.

The importance of being unimportant: small firms and small banks in Italy

Global Business and Economics Review, 2002

According to the literature on the credit channel, changes in monetary policy affect small firms by changing the costs of external financing. The literature, however, has not yet explored the relationship between the cost of available credit to different groups of borrowers and the competitiveness of the banking industry. I suggest the existence of a relationship between the cost of loans to small borrowers and the degree of concentration in the banking industry. The intuition is that if many banks compete to finance small firms, small f m have the option to switch lender. This, in turn, forces competing banks to absorb, at least in part, the shock introduced by the change in monetary policy thereby sheltering small firms from the negative asymmetric effect of monetary policy.

Capital Structure across Italian Regions: The Role of Financial and Economic Differences

Sustainability

The objective of this article is to analyse how regional financial and economic differences influence the capital structure decisions of small and medium-sized enterprises (SMEs). Specifically, this paper considers the regional financial and economic differences in four ways: the development of the financial sector in the region, bank market concentration, the financial cost of obtaining funds, and regional economic development. For this purpose, we used unbalanced panel data from 26,504 SMEs across the 20 Italian regions and over the period from 2004 to 2010. This work is completed with an analysis of a no-crisis (2004–2007) and a crisis period (2008–2010). The results show that the regional differences in the degree of financial sector development, banking concentration, and local economic situations have a significant impact on the leverage level of SMEs, while the cost of obtaining funds is only relevant during a period of economic stability. These results suggest that insights ...

Italian credit cooperative banks: the fundamental role in supporting the growth of SMEs and family businesses

Global Business and Economics Review

Our research concentrates on the role of Italian credit cooperative banks, supporting the entrepreneurship and the development of SMEs and family businesses. We took into consideration the data of loans, allocated by those banks in 2014. We tried to find the relationship between the banking system and the world of SMEs and family businesses. This research represents the first step of a far deeper analysis. In this stage, we aimed at providing the groundwork for further empirical and qualitative analyses. Therefore, we try to improve the existing literature by using a conceptual approach. Despite the limitations of this research, researchers in the field of SMEs and credit cooperative banks can consider the opportunities for further developments of our analysis. Our findings give evidence that SMEs and family businesses need the support of the credit cooperative banks, in order to further exploit the opportunity to expand their businesses.

The political economy of financing local production in Italy, 1950-1990s

2015

Francesca Carnevali’s work stressed the key role of politics and institutions in determining a country’s banking structure, which in turn shapes its industrial structure. Segmented banking systems in France, Germany and Italy allowed different types of banks to specialize in different market segments, ensuring the fulfilment of smaller firms’ financial requirements. In Britain, local banks did not survive the wave of amalgamation of the 1960s. This void left smalland medium-sized enterprises (SMEs) and banks facing high transaction costs on the credit market due to little – or even an absence of – knowledge of the local business environment. Focusing on the Italian case this paper discusses how major parties in the political spectrum, as well as economic institutions such as the Bank of Italy, agreed to foster SMEs after the Second World War. This led to the establishment of a segmented banking system, in which local banks were preserved to serve the financial needs of SMEs clustere...

Financial policy of Italian SMEs: The impact of mini-bond

Corporate Ownership and Control, 2019

Matter of interest is the financing policies adopted by Italian SMEs to sustain their business cycles and competitive strategies; more specifically, the paper attempts to verify the role played by the “mini-bond”, a financing instrument introduced in 2012 by the Italian government. So, this paper can be framed in the part of the wide financial literature that examines the financing decisions of SMEs. In this field, it provides a contribution in this field by analyzing the impacts on the financing policy and choices, generated by the introduction of new and alternative financial instruments. Therefore, focusing on the Italian context, the research analyses whether the mini-bonds have actually triggered variations in capital structure, solvency and profitability of Italian SMEs that have issued mini-bond. After having considered trends and statistics about the mini-bond market, the paper examines the effects of financial policies adopted by Italian companies that tapped the bond marke...

Small and Medium-Sized Enterprises in Italy and Challenges they Face

2020

SME is the acronym for small and medium sized enterprises. It is very difficult to provide a definition of SME since certain criteria have been used to define what SME stand for most especially according to the countries, sizes and sectors1. It should be stressed that these kinds of businesses arose as a result of entrepreneurial activities of individuals. A commonly accepted definition of SMEs in UE countries is enterprises which employ less than 250 people, whose annual revenue does not exceed 50 million Euro or whose the total balance sheet does not exceed 43 million Euro2. The importance of the SMEs in the world’s economy is not an unexplored topic and their strong impact on the countries’ economies is unanimously recognized3 . SMEs’ features such being: