Abstract
How do finance their investment? To what extent does the financing mix depends on the nature or the size of investment? To what extent does the funding mix of investment vary along firm size? Relying on a unique database of covering 72% of the value added in France over three decades, this paper addresses those questions and provides a comprehensive picture of the financial resources used by to finance their investment. We uncover significant cross-sectional heterogeneity in the financing mix of investment along firm size, asset tangibility and investment size. In particular, we show that the commonly held view that firms strongly rely on bank credit in a bank-based economy weakens significantly as we consider larger or when it comes to finance intangible investments or relatively small investments.
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