Highly leveraged small businesses cannot obtain enough credit because of the debt overhang problem. Therefore, highly leveraged firms may lose potential profits from profitable investment opportunities in which they are unable to invest. On the other hand, highly leveraged small businesses can...

This article examines whether founders’ human capital affects not only actual investment but also required investment in research and development (R&D), using the original data of Japanese start-up firms. The estimation results indicate that higher levels of founders’ human capital,...

This paper investigates the effects of public policy and financial structure on the growth of small and medium enterprises (SMEs). Using a panel data set on SMEs in the Japanese manufacturing industry, we examine whether or not the SME Creative Business Promotion Law (CBPL) and financial...