On Study Of The Financial Sources For SMEs

SMEs(small-and-medium-sized enterprises) have always been plagued by the difficulty in financing, which hinders the development of private economy in China. The traditional financing theory of SMEs mainly focus on the impact of formal sytems such as economy and law on enterprises' financing behaviors. However, it shows insufficient consideration for informal systems such as social relation network. This paper will try to solve the difficulty in financing of SMEs from a brand new sociological perspective, on the basis of social relation network theory.Based on the questionnaire of field investigation, this paper takes 125 SMEs from Zhejiang Province as its samples, including places like Shaoxing, Hangzhou, Jinhua, and so on. It analyzes the influence of the level of social relation network on financing by the means of Probit model and the multivariate regression model. Among them, the level of social relation network is evaluated on four indices, i.e. network scope, network relation strength, network relation duration, network openness and so on. Some other factors are also taken into consideration, such as the age, education, work experience of the entrepreneurs in this industry, etc. The focus is mainly on the external financing problems of SMEs and the evaluation is made mainly on three aspects, i.e. credit constraints, financing difficulties and financing costs. The empirical study shows that certain levels of social relation network have significant impacts on the external financing difficulties of SMEs indeed.