Korea Trade Review (무역학회지)

Korea Trade Research Association (한국무역학회)
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Relationship Banking and Exports: Evidence from SMEs in the Korean Stock Markets

관계금융이 중소기업의 수출에 미치는 영향에 관한 연구

  • Jeong-Dae Yim (BK21 FOUR, College of Business Administration, Chonnam National University)
  • 임정대 (전남대학교 경영학과 BK21 FOUR )
  • Received : 2020.07.15
  • Accepted : 2020.10.29
  • Published : 2020.10.31
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Abstract

This study explores the role of relationship banking for the exports of SMEs (small and medium sized enterprises) in Korea. Using a sample of SMEs listed on the Korean stock markets between 2004 and 2018, I find that relationship banking has a positive impact on exporting behaviors of SMEs. This result indicates that relationship banking is suitable for SMEs to raise their funds in the export decision-making since the incentive for banks to obtain soft information enhances SMEs' access to external finance. In particular, through further analysis considering financial constraints, I find that the positive impact of relationship banking on exports is amplified for financially constrained SMEs. In addition, the positive impact on exports is also amplified for export starters. Finally, relationship banking provides benefits for SMEs' export decision-making regardless of the financial crisis. To sum up, relationship banking may be useful means of financing for Korean SMEs whose creditworthiness cannot be assessed only by hard information. As the role of finance in international trade has recently been highlighted, this study provides insightful evidence that relationship banking may enhance exports of SMEs as a source of trade finance.

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