earticle

영어

In this paper, we explore the relationship between soft information and borrowing small firms' economic performances. And we analyse what informations and variables are important to explain firms' defaults. We consider non-financial information as soft information. The data set is made up of financial and non-financial data of small-business firms from 2004 until 2007. We estimate two logit models to explain firms' performance variables and default events using relevant dependent variables such as credit information,soft information, financial information, and other characteristic variables. It turns out that financial information is important to explain firms' performances. Financial information and credit information are statistically significant to explain default events. However, the estimate of the explanatory variable of soft information is statistically significant negative. This implies that soft information is not good enough to explain the default probability. So we need to improve the quality of soft information so that it may be useful and meaningful to explain default events.