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Mind the Gap: Public Equity as a Financing Solution for Medium-Sized Enterprises and the Influence of National Culture

Koch, Lisa; Crossan, Kenny; Jaworski, Piotr


Lisa Koch

Piotr Jaworski


This research focuses on the demand from medium-sized firms to access public equity as a source of finance. The acceptance of public equity differs strongly between countries, particularly between the United Kingdom and Germany. Therefore, this research aims to identify the impact of national culture on the decision to go public in these two countries.

The theoretical framework builds on the satisficing theory of rationality, the pecking-order theory as well as Hofstede's cultural dimension theory. Using a questionnaire, over 1,000 medium-sized businesses in the United Kingdom and Germany were surveyed.

The findings demonstrate that British medium-sized firms are more open to using public equity as a source of finance than their German counterparts. The results indicate that national culture not only affects the decision to go public but also has a negative impact on uncertainty avoidance and long-term orientation.

The originality of the research lies in the focus on medium-sized firms and the effects of cultural differences between the United Kingdom and Germany. No previous research has explored how culture influences the decision to go public using a dataset generated from medium-sized firms in the United Kingdom and Germany.

Journal Article Type Article
Acceptance Date Jul 25, 2022
Online Publication Date Aug 25, 2022
Publication Date 2022-10
Deposit Date Aug 24, 2022
Publicly Available Date Aug 24, 2022
Journal International Journal of Entrepreneurial Behavior & Research
Print ISSN 1355-2554
Publisher Emerald
Peer Reviewed Peer Reviewed
Volume 28
Issue 7
Pages 1800-1827
Series ISSN 1355-2554
Keywords SMEs, Financing gap, National culture, Public equity
Public URL


Mind The Gap: Public Equity As A Financing Solution For Medium-Sized Enterprises And The Influence Of National Culture (accepted version) (2.2 Mb)

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