Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/286932 
Year of Publication: 
2021
Citation: 
[Journal:] Journal of Business Economics [ISSN:] 1861-8928 [Volume:] 91 [Issue:] 6 [Publisher:] Springer [Place:] Berlin, Heidelberg [Year:] 2021 [Pages:] 797-849
Publisher: 
Springer, Berlin, Heidelberg
Abstract: 
This paper examines how legally restricted access to banking services affects small and medium-sized enterprises (SMEs) in a highly developed country. Using a mixed-method approach, we examine the unique situation of the US marijuana industry. The industry benefits from the superior institutional environment in terms of legal protection and the labor market of the United States. However, due to conflicting state and federal laws it has no legal access to banking. We find significant value effects around three major events that affected future access to banking. These results indicate that banking access remains desirable for the marijuana industry. A survey taken by marijuana SMEs provides insights into what banking services are considered most valuable. We find that marijuana SMEs have problems to obtain financing and handle their transactions largely in cash, resulting in transaction inefficiency and high security concerns. Thereby, we shed light on the value of banks for SMEs in developed countries. We complement the literature on financial transaction services by highlighting the value for SMEs in developed markets.
Subjects: 
Access to banking
Financial development
Small and Medium-sized enterprises
Marijuana firms
JEL: 
D22
G21
M13
M21
O16
O43
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.