From Table 1 we observe that there is not a great deal of empirical support for many of the key predictions from theory in our unique context of the GFC. The most consistent relationships are the negative effect of firm size and length of relationship on levels of discouragement. Here smaller firms are the most likely to be discouraged, as are those with the shortest relationships with their financiers. This evidence lends support to the theory that relationships with financiers reduce information asymmetries and lead to lower levels of discouragement. Method Data This is intended to analyse existing data from seven Barometer’ surveys ‘Business conducted by BIS which cover information of small businesses during the latest recession. The firms interviewed in the Barometer’ surveys are a sub-sample of the ‘Business 2007/08 UK Annual Small Business Survey (ASBS). The ASBS survey is a large-scale telephone-based survey conducted to monitor key trends in the characteristics and perceptions of UK small business owners and managers among all industry sectors and regions. It has been conducted on an annual basis since 2003. 3,506 out of the 19,188 2007/08 ASBS sample firms were re-contacted to determine how well or badly they have performed in the previous year, and to assess their levels of business confidence going forward. On average 500 SMEs were re-surveyed using questions similar to the 2007/08 ASBS in each of the seven ‘Business Barometer’ waves (no firm participated in multiple surveys), starting from December 2008 to February 2010 with intervals of two to three months. The survey period coincides with the latest financial crisis therefore gives us the opportunity to investigate how business attitudes and access to finance by UK SMEs change during the recession. We undertook a one-to-one merge of the Barometer’ data with the ASBS ‘Business 07/08 data, which result in a data set of 3,506 SMEs with no loss of data from the merge.
From Table 1 we observe that there is not a great deal of empirical support for many of the key predictions from theory in our unique context of the GFC. The most consistent relationships are the negative effect of firm size and length of relationship on levels of discouragement. Here smaller firms are the most likely to be discouraged, as are those with the shortest relationships with their financiers. This evidence lends support to the theory that relationships with financiers reduce information asymmetries and lead to lower levels of discouragement. Method Data This is intended to analyse existing data from seven ‘Business Barometer’ surveys conducted by BIS which cover information of small businesses during the latest recession. The firms interviewed in the ‘Business Barometer’ surveys are a sub-sample of the 2007/08 UK Annual Small Business Survey (ASBS). The ASBS survey is a large-scale telephone-based survey conducted to monitor key trends in the characteristics and perceptions of UK small business owners and managers among all industry sectors and regions. It has been conducted on an annual basis since 2003. 3,506 out of the 19,188 2007/08 ASBS sample firms were re-contacted to determine how well or badly they have performed in the previous year, and to assess their levels of business confidence going forward. On average 500 SMEs were re-surveyed using questions similar to the 2007/08 ASBS in each of the seven ‘Business Barometer’ waves (no firm participated in multiple surveys), starting from December 2008 to February 2010 with intervals of two to three months. The survey period coincides with the latest financial crisis therefore gives us the opportunity to investigate how business attitudes and access to finance by UK SMEs change during the recession. We undertook a one-to-one merge of the ‘Business Barometer’ data with the ASBS 07/08 data, which result in a data set of 3,506 SMEs with no loss of data from the merge.