Debt signaling and outside investors in early stage firms
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- dc.contributor.author Epure, Mircea
- dc.contributor.author Guasch, Martí
- dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
- dc.date.accessioned 2020-05-25T09:26:45Z
- dc.date.available 2020-05-25T09:26:45Z
- dc.date.issued 2015-11-01
- dc.date.modified 2020-05-25T09:25:05Z
- dc.description.abstract By imposing a market like governance and directing entrepreneurs towards professional management, debt, and especially business debt, can serve as a reliable signal for outside equity investors. Such signals of firm accountability can alleviate the stringent information asymmetry at the early stages of the firm, and become stronger for bank business debt, in the presence of personal debt, and in high capital industries. Using the Kauffman Firm Survey, we find evidence consistent with our hypotheses. Outside investors can rely on the governance role of debt and its underpinnings such as the bank-firm relationship. We also corroborate that young firms tend to focus on growth rather than profitability.
- dc.format.mimetype application/pdf*
- dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=1546
- dc.identifier.citation
- dc.identifier.uri http://hdl.handle.net/10230/27446
- dc.language.iso eng
- dc.relation.ispartofseries Economics and Business Working Papers Series; 1546
- dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
- dc.rights.accessRights info:eu-repo/semantics/openAccess
- dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
- dc.subject.keyword governance; entrepreneurship; financing; information asymmetry; debt; equity
- dc.subject.keyword Management and Organization Studies
- dc.subject.keyword Finance and Accounting
- dc.title Debt signaling and outside investors in early stage firms
- dc.title.alternative
- dc.type info:eu-repo/semantics/workingPaper