In the current study, we investigate the determinants of financing types of green products or services for the Small and Medium-Sized Enterprises (SMEs) in 27 EU countries and selected countries such as Norway, Iceland and the USA. We utilize the Flash Eurobarometer-Small and Medium-Sized Enterprises, Resource Efficiency, and Green Markets Survey (GESIS) and estimate a two-stage Heckman selection model to tackle sample selection bias. In the first stage, while we analyze the decision to produce green products or services, in the second stage, we focus on the financing of green product or services producers. The results suggest that the financial adequacy of the European SMEs that enables them to finance green products or services is crucial for producing green products or services. Firms need further resources to sustain those activities. In addition, technical expertise also plays a crucial role in producing green products or services. Financial adequacy, therefore, is not a sufficient condition for green production.
Key words: Small and Medium-Sized Enterprises; green product. JEL Codes: L25, O30, Q40, Q50. Article Language: EnglishTurkish
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