Informal Financing of Small – Medium Enterprise Sector: The Case of Greece
Panagiotis Petrakis, Konstantinos Eleftheriou
DOI: 10.4236/jssm.2009.24045   PDF    HTML     6,383 Downloads   11,790 Views   Citations


In this paper, we attempt to find a “channel” through which Greek economy can exhibit a relative “resistance” in a credit crunch. For this purpose, we specify an error correction model so as to test the relationship between corporate bank loans and commercial papers comprised of post-dated cheques and bills of exchange. The results show that corporate bank loans and cheques - bills of exchange are substitutes. This finding combined with the fact that in Greece, the issuance of these papers is positively connected with the informal economic activity which in turn rises during economic downturns, has a strong economic implication regarding the ability of Greek economy to partly “amortize” the shocks connected with the current financial crisis.

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Petrakis, P. and Eleftheriou, K. (2009) Informal Financing of Small – Medium Enterprise Sector: The Case of Greece. Journal of Service Science and Management, 2, 378-383. doi: 10.4236/jssm.2009.24045.

Conflicts of Interest

The authors declare no conflicts of interest.


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