NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Banking Deregulations, Financing Constraints, and Firm Entry Size

William Kerr, Ramana Nanda

NBER Working Paper No. 15499
Issued in November 2009
NBER Program(s):   PR

We examine the effect of US branch banking deregulations on the entry size of new firms using micro-data from the US Census Bureau. We find that the average entry size for startups did not change following the deregulations. However, among firms that survived at least four years, a greater proportion of firms entered either at their maximum size or closer to the maximum size in the first year. The magnitude of these effects were small compared to the much larger changes in entry rates of small firms following the reforms. Our results highlight that this large-scale entry at the extensive margin can obscure the more subtle intensive margin effects of changes in financing constraints.

download in pdf format
   (93 K)

email paper

This paper is available as PDF (93 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w15499

Published:

  • Kerr, William R. & Nanda, Ramana, 2009. "Democratizing entry: Banking deregulations, financing constraints, and entrepreneurship," Journal of Financial Economics, Elsevier, vol. 94(1), pages 124-149, October.
  • William R. Kerr & Ramana Nanda, 2010. "Banking Deregulations, Financing Constraints, and Firm Entry Size," Journal of the European Economic Association, MIT Press, vol. 8(2-3), pages 582-593, 04-05. citation courtesy of

Users who downloaded this paper also downloaded these:
Kerr and Nanda w15498 Financing Constraints and Entrepreneurship
Morck, Yavuz, and Yeung w15575 Banking System Control, Capital Allocation, and Economy Performance
Beck, Levine, and Levkov w13299 Big Bad Banks? The Impact of U.S. Branch Deregulation on Income Distribution
Mitchener and Wheelock w15710 Does the Structure of Banking Markets Affect Economic Growth? Evidence from U.S. State Banking Markets
Cull, Davis, Lamoreaux, and Rosenthal w11695 Historical Financing of Small- and Medium-Sized Enterprises
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us