Capital structure and financing of SMEs : empirical evidence from Ghana and South Africa
| dc.contributor.advisor | Biekpe, Nicholas | en_ZA |
| dc.contributor.author | Abor, Joshua | en_ZA |
| dc.contributor.other | Stellenbosch University. Faculty of Economic and Management Sciences. Dept. of Business Management. | en |
| dc.date.accessioned | 2012-07-04T08:21:23Z | |
| dc.date.available | 2012-07-04T08:21:23Z | |
| dc.date.issued | 2007-12 | |
| dc.description | Dissertation (PhD)--University of Stellenbosch, 2007. | en_ZA |
| dc.description.abstract | ENGLISH ABSTRACT: This thesis is made of stand-alone essays on the capital structure and financing of Small and Medium Enterprises (SMEs) in Ghana and South Africa. Chapter Two reviews issues on SME development in Ghana and South Africa. Chapter Three compares the capital structures of large, quoted firms and SMEs in Ghana. The results show that quoted firms exhibit higher debt ratios than those of SMEs. The results suggest that age, size, asset structure, and profitability of the firm affect the capital structures of quoted firms and SMEs. For the SME, it is evident that level of education and gender of the entrepreneur, industry, and location of the firm are also important in explaining their capital structure. Chapter Four examines the determinants of bank financing of SMEs in Ghana. The results reveal that bank financing accounts for less than a quarter of SMEs’ debt financing, with short-term bank credit representing the greater proportion of bank finance. The results show that age, size, asset tangibility, and growth of the firm have positive associations with long-term bank debt, while profitability is negatively related to long-term bank debt. The short-term debt indicates a positive relationship with size, but negative relationships with profitability, and growth. Chapter Four also investigates the awareness and use of various financing schemes available to the Ghanaian SME sector. The results reveal low awareness and usage levels of these financing initiatives. Chapter Five explores the determinants of Ghanaian small and medium sized non-traditional exporters’ (NTEs) choice of formal/informal finance. The results show that NTEs depend on formal financing sources with bank finance representing the greater percentage of NTEs’ financing. The results suggest that, newer firms depend more on formal finance and less on informal finance. The results show positive relationships between formal finance and size, and growth of the firm. Chapter Six assesses how corporate governance affects the performance of SMEs in Ghana and what the implications are for financing opportunities. The results reveal that better corporate governance structures lead to better performance of SMEs. The paper concludes that the adoption of good corporate governance structures could lead to better management decisions and enable SMEs to attract financing resources. Chapter Seven examines the relationship between agency factors and the capital structure of quoted SMEs in South Africa. The results indicate that firms with one institutional blockholder are able to monitor the opportunistic behaviour of management more effectively than those with more than one institutional blockholders. Chapter Eight looks at the financial market and financing choice of SMEs and large firms in South Africa. The results indicate that developments in the financial market affect both longterm debt/equity and short-term debt/equity decisions of large firms. However, for SMEs, it is the long-term debt/equity decision that is affected by the financial market. The final essay examines the effect of debt policy on the performance of SMEs in Ghana and South Africa. The results indicate that long-term debt and total debt ratios negatively affect performance of SMEs. These findings have important implications for policy-makers, entrepreneurs and managers of SMEs. | en_ZA |
| dc.description.abstract | AFRIKAANSE OPSOMMING: Hierdie tesis bestaan uit losstaande essays oor die kapitaalstruktuur en finansiering van kleinen middelgrootte-ondernemings (KMO's) in Ghana en Suid-Afrika. Hoofstuk Twee kyk na kwessies oor KMO-ontwikkeling in Ghana en Suid-Afrika. Hoofstuk Drie vergelyk die kapitaalstrukture van groot genoteerde maatskappye en KMO's in Ghana. Die resultate dui daarop dat genoteerde maatskappye groter skuldverhoudings as KMO's toon. Hierdie resultate wys ook dat ouderdom, grootte, batestruktuur en die winsgewendheid van die maatskappy die kapitaalstruktuur van genoteerde maatskappye en KMO's beïnvloed. Dit is vir die KMO voor die hand liggend dat die opvoedingsvlak en geslag van die entrepreneur, die bedryf en die ligging van die maatskappy ook belangrik is om die kapitaalstruktuur daarvan te verduidelik. Hoofstuk Vier ondersoek die bepalende faktore vir bankfinansiering vir KMO's in Ghana. Die resultate toon aan dat bankfinansiering rekenskap gee van minder as 'n kwart van die KMO se skuldfinansiering en dat korttermynbankkrediet die grootste gedeelte van die bankfinansiering verteenwoordig. Die resultate toon aan dat ouderdom, grootte, die tasbaarheid van bates en maatskappygroei op 'n positiewe verwantskap met langtermynskuld dui, terwyl winsgewendheid 'n negatiewe verband met langtermynbankskuld het. Die korttermynskuld toon 'n positiewe verwantskap met grootte maar 'n negatiewe verwantskap met winsgewendheid en groei aan. Hoofstuk Vier ondersoek ook die bewustheid en gebruik van verskeie finansieringskemas wat aan die Ghanese KMO-sektor beskikbaar is. Die resultate bring 'n lae bewustheid en gebruiksvlakke van hierdie finansieringsinisiatiewe aan die lig. Hoostuk Vyf verken die bepalende faktore van die Ghanese klein- en middelgrootte nie-tradisionele uitvoerders (NTU's) se keuse van formele/informele finansiering. Die resultate toon aan dat NTU's op formele finansieringsbronne staat maak en dat bankfinansiering die grootste persentasie van die NTU's se finansiering uitmaak. Uit die resultate kan afgelei word dat nuwer maatskappye meer op formele finansiering staat maak en minder op informele finansiering. Die resultate dui op 'n positiewe verwantskap tussen formele finansiering en grootte, en die groei van die maatskappy. Hoofstuk Ses evalueer die invloed van korporatiewe bestuur op die prestasie van KMO's in Ghana en watter implikasies dit vir finansieringsgeleenthede inhou. Die resultate toon aan dat beter korporatiewe finansieringstrukture by KMO's tot beter prestasie lei. Hierdie essay kom tot die gevolgtrekking dat die aanvaarding van goeie korporatiewe bestuurstrukture tot beter bestuursbesluite kan lei en KMO's in staat kan stel om finansieringsbronne te lok. Hoofstuk Sewe ondersoek die verwantskap tussen agentskapfaktorering en die kapitaalstruktuur van genoteerde KMO's in Suid-Afrika. Die resultate dui daarop dat maatskappye met een institusionele blokhouer die opportunistiese gedrag van bestuur meer doeltreffend kan monitor as dié met meer as een institusionele blokhouer. Hoofstuk Agt kyk na die keuses wat KMO's en groot maatskappye in Suid-Afrika ten opsigte van finansiële markte en finansiering maak. Resultate toon aan dat ontwikkelings in die finansiële mark besluite oor die langtermynskuld/aandelekapitaal sowel as die korttermynskuld/aandelekapitaal van groot maatskappye beïnvloed. By KMO's is dit egter besluite oor langtermynskuld/aandelekapitaal wat deur die finansiële mark beïnvloed word. Die laaste essay ondersoek die uitwerking van skuldbeleid op die prestasie van KMO's in Ghana en Suid-Afrika. Die resultate toon aan dat langtermynskuld en totale skuldverhoudings die prestasie van KMO's negatief beïnvloed. Hierdie bevindinge het belangrike implikasies vir beleidmakers, entrepreneurs en die bestuurders van KMO's. | af |
| dc.format.extent | xii, 233 leaves | |
| dc.identifier.uri | http://hdl.handle.net/10019.1/21522 | |
| dc.language.iso | en_ZA | en_ZA |
| dc.publisher | Stellenbosch : Stellenbosch University | |
| dc.rights.holder | Stellenbosch University | en_ZA |
| dc.subject | Small business -- Ghana -- Finance | en_ZA |
| dc.subject | Small business -- South Africa -- Finance | en_ZA |
| dc.subject | Theses -- Business management | en_ZA |
| dc.subject | Dissertations -- Business management | en_ZA |
| dc.title | Capital structure and financing of SMEs : empirical evidence from Ghana and South Africa | en_ZA |
| dc.type | Thesis | en_ZA |