Franchisees and Loan Default on Third-Party Guarantee Loans: Evidence From the United States

We test the inefficient risk-bearing hypothesis—that third-party loan guarantors bear a higher risk on loans to franchisees than on loans to independent businesses—by assessing whether franchisees default more than independent businesses on third-party guarantee loans. In a sample of 428,233 SBA 7(a...

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Bibliographic Details
Published in:Entrepreneurship theory and practice 2020-09, Vol.44 (5), p.861-877
Main Authors: Patel, Pankaj C., Pearce, John A.
Format: Article
Language:English
Subjects:
Commercial loans
Companies
Default
Default (Finance)
Finance
Franchisees
Franchises
Loans
Management
Management research
Risk
Risk management
Suretyship and guaranty
Third party
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