Work

Do Social Capital Building Strategies Influence the Financing Behavior of Chinese Private Small and Medium–Sized Enterprises?

Year: 2013

Type: article

Abstract: Using data from 65,485 Chinese private small and medium–sized enterprises over the period 2000–2006, we examine the extent to which firms can improve access to debt by adopting strategies aimed at building social capital, namely entertaining and gift giving to others in their social network, and obtaining political affiliation. We find that although entertainment and gift–giving expenditure leads to higher levels of total and short–term debt, it does not enable firms to obtain greater long–term debt. In contrast, we demonstrate that obtaining political affiliation allows firms greater access to long–term debt.

Source: Entrepreneurship Theory and Practice

DOI: 10.1111/etap.12051

Authors: Jun Du, Alessandra Guariglia, Alexander Newman

Institutions: Aston University, Stockholm School of Economics, University of Birmingham, Monash University

Language: English

Topic: Political Influence and Corporate Strategies

Subfield: Strategy and Management

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: green

Funder: Economic and Social Research Council

Awards: G5907776411, G7706841186