PhD Spotlight – Nicolas Legendre

Nicolas Legendre joined the PhD in Management program at Telfer in 2016, after completing his MSc in Management at the school. He is specializing in finance under the supervision of Professor Miwako Nitani. During his studies, he has received the Lilian and Swee Chua Goh Doctoral Scholarship and the SSHRC Joseph-Armand Bombardier Canada Graduate Scholarship. We interviewed him to learn more about his research on financing of small and medium sized businesses in Canada.

Why did you choose to study finance?

I chose to study finance with a focus on small businesses because of the disproportionate contribution of small businesses towards a country’s economic growth. Alleviating financial barriers faced by entrepreneurs, specifically, members of underrepresented groups, is crucial to supporting the growth of small businesses, our primary growth drivers.

What is your research about and what will it contribute to academic literature?

My research looks at the entire process of raising capital for small businesses. One of the unique aspects of my research is my focus on underrepresented groups and discrimination. It contributes to the academic literature by distinguishing between the types of discrimination (taste-based vs. statistical) that members of underrepresented groups may face when trying to obtain external financing.

Your recent work was published in the Journal of Banking and Finance. What are the highlights from that study?

My recent publication entitled “Cooperative lenders and the performance of small business loans” looked at the impact of lender type at the last stage of raising capital for small businesses. Specifically, it investigated the notion that cooperative lenders (credit unions and caisses populaires) face less severe information asymmetry compared to major banks. We found that small business loans advanced by cooperative lenders are less likely to lead to default compared to those extended by major banks, highlighting the importance of cooperative lenders for small business lending.

What impact could your research have on public policy?

My thesis research can influence public policy by informing programs that seek to alleviate financial constraints faced by small businesses. For example, my thesis found that members of underrepresented groups are more likely to forego applying for financing, even though they need financing, due to fear of having their loan application rejected. Accordingly, targeted programs that aim to support access to financing for members of underrepresented groups should focus on addressing these discouraging barriers.