Financial Development and Financial Structure of Industrial SMEs: The Case Of Greece

Voulgaris, F., Asteriou, D., Agiomirgianakis, G.
European Research Studies Journal, Volume III, Issue 3-4, 95-110, 2000
EOI: 10.11214/thalassinos.03.02.007


The aim of this paper is to investigate the determinants of capital structure for the Greek manufacturing SMEs (1-100 employees). Various theories on the determinants of capital structure of SMEs are discussed and findings of previous empirical studies are examined. This study is based on a panel data set consisted of a random sample of 142 manufacturing SMEs in Greece for the time span 1989-1996. A non-linear regression model was developed with total debt, short-term debt and long-term debt ratios used as dependent variables. Enterprise size, profitability, asset structure, liquidity, average inventory period and accounts receivables collection period are found to have a significant effect on the capital structure of Greek manufacturing SMEs. A number of policy implications are suggested by the findings, which will improve the viability, growth and competitiveness of the manufacturing SME sector in Greece.

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