Thesis (Ph.D.) - Cairo University - Faculty of Economy and Political Sciences - Department of Economics

This study assesses the micro, small and medium enterprises' credit constraints during the period (2004-2013), in light of the latest Egyptian financial and institutional reforms. A new measure of the credit constrained status (CCS) is adopted to evaluate MSMEs' credit constraints, controlling for firms' characteristics, such as firm size, age, degree of formality, entrepreneur level of education and age, credit collateral and interest rate. This study explores as well the extent to which the informality of Egyptian MSMEs would be associated with their access to formal credit. Using the Egyptian MSE surveys of 2003 and 2011 and the World Bank Enterprise surveys (WBES) during the period (2004 - 2013), an ordered logistic regression and Random Effects ordered logistic regression are conducted to study the evolution of the CCS of MSMEs over time. Results show that firm size is negatively related to the MSEMs' CCS. This significant negative relationship has attenuated over time signaling possible success of the Egyptian reforms. Moreover, findings indicate that age and degree of formality of the firm, as well as entrepreneur education level, are significantly associated to their CCS over time. However, results indicate that access to credit become more difficult over time, as revealed in credit collateral and interest rate coefficients. Moreover, it was found that internal funds are used mostly by MSMEs instead of external sources of finance. This can be regarded as an indication of some deficiencies in implementing Egyptian reforms. Accordingly, it could be concluded that Egyptian financial and institutional systems are in need of further revisions and adjustments

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