Corpus ID: 14408261

The Benefits of Firm-Creditor Relationships: Evidence from small business data. *

@inproceedings{Petersen1993TheBO,
  title={The Benefits of Firm-Creditor Relationships: Evidence from small business data. *},
  author={M. Petersen and R. Rajan},
  year={1993}
}

M. Petersen, R. Rajan

Published 1993

Business

This paper empirically examines how close ties between a firm and its creditors affects the availability and the costs of funds to the firm. We analyze data collected in a survey of small firms by the Small Business Administration. We find that the primary benefit to a firm of building close ties with a creditor is that the availability of financing increas es. We find no analogous effect on the price of credit. Attempts by a firm to widen its circle of relationships by borrowing from multiple… CONTINUE READING

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