Innovation and SME finance: Evidence from developing countries

By N. Wellalage, V. Fernandez. International Review of Financial Analysis, 2019

157 citations recorded by the source corpus.

This paper explores the relationship between firm-level innovation and external finance for small and medium enterprises (SMEs). Our sample consists of 13,430 firms from Eastern Europe and Central Asian countries. A propensity score matching approach reports a positive relationship between formal finance and product and process innovation, which is greater for early-stage SMEs than for mature counterparts. However, informal finance has more significant impact on mature firms' product innovation. Our empirical evidence highlights policy implications for countries desiring to enhance the innovation of their SMEs by improving the external finance of these SMEs.

Subfields: Accounting, Information Systems

View Paper: https://www.semanticscholar.org/paper/6b095e806ef71263e854f665c463906f68b24e4c

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Accounting

1. Ș. Gherghina
2. Mihai Alexandru Botezatu
3. Alexandra Hosszu
4. L. Simionescu

In Information Systems

1. Ș. Gherghina
2. Mihai Alexandru Botezatu
3. Alexandra Hosszu
4. L. Simionescu

Citations in the corpus

• Small and Medium-Sized Enterprises (SMEs): The Engine of Economic Growth through Investments and Innovation (2020, background): “Wellalage and Fernandez [46] documented that having formal finance is positively related to firm-level product innovation and process innovation.”