SME’s Cost of Debt: A Meta-Analysis of Borrower, Creditor and Financial Statement Verification Attributes

Authors

Thomas R. Loy, University of BremenFollow
Stefan Mohrmann, University of BayreuthFollow

Abstract

Private firm financing, given the far-reaching importance of non-publicly traded companies for global output and employment, is still a relatively underexplored area. Since the seminal work of Petersen and Rajan (1994), only a small branch of research into private firms’ cost of debt has been established. We aggregate the full body of this research that has empirically investigated antecedents of private firms’ cost of debt in a meta-analysis. The foremost antecedents can be categorized into either borrower, creditor or financial statement verification attributes. Our results reveal a set of 11 highly significant and robust determinants.

JEL Codes

G21 G32

Keywords

Cost of debt, Meta-analysis, Private firms, SME

Recommended Citation

Loy, Thomas R. and Mohrmann, Stefan (2022) "SME’s Cost of Debt: A Meta-Analysis of Borrower, Creditor and Financial Statement Verification Attributes," The Journal of Entrepreneurial Finance: Vol. 24: Iss. 2.
DOI: https://doi.org/10.57229/2373-1761.1400
Available at: https://digitalcommons.pepperdine.edu/jef/vol24/iss2/1

Creative Commons License

This work is licensed under a Creative Commons Attribution-Noncommercial 4.0 License