Family finance and new business start-ups

摘要

After bank finance, borrowing from family and friends is the chief source of funds for new business start-ups in many countries, including the UK. Yet there has been virtually no treatment of this issue inthe literature to date. We rectify this omission by developing a model of lending behaviour in which family members may have selfish or altruistic motives. We identify the key determinants of family leding using a unique data on Asian entrepreneurs in Britain.