The Impact of Venture Capital on the Financial Structure of Belgian SMEs

Abstract

The objective of this research is to investigate the impact of the deduction for venture capital (deduction of the notional interests) on the structure of financing of Belgian SMEs. The tests of hypotheses conducted on a panel sample of 1,176 companies point out that firms rely more on self-financing since the introduction of the deduction for venture capital. Moreover the paper highlights that firms limit the use of long-term financial debts. Finally, the econometric model allows to clearly identify the negative impact of the deduction for venture capital on the global degree of debts.