Missing Link Between Financial Constraints and Productivity.
Title:
Missing Link Between Financial Constraints and Productivity.
Author:
Moreno Badia, Marialuz.
ISBN:
9781451916546
Personal Author:
Physical Description:
1 online resource (41 pages)
Series:
IMF Working Papers
Contents:
Contents -- I. Introduction -- II. Data and Stylized Facts -- III. Measuring Financial Constraints -- A. Euler Equation Approach -- B. Empirical Model -- C. Estimation Issues -- D. Results on Financial Constraints -- IV. Relating Productivity to Financial Constraints -- V. Results -- A. Baseline Results -- B. Robustness Checks -- VI. Conclusions -- Tables -- 1. Ownership Structure -- 2. Number of Firms by Year and Industry, 1997-2005 -- 3. Summary Statistics -- 4. Euler Equation Specification, Estimated Using System GMM -- 5. Magnitude and Distribution of Financing Constraints by Sector -- 6. Correlation between Financial Constraints and Other Firm Characteristics -- 7. Baseline Results, by Industry -- 8. Robustness Checks -- Figures -- 1. Size Distribution -- 2. Entry and Exit Rates, 1997-2005 -- 3. Sales per worker, 1997-2205 -- 4. Capital Intensity, 1997-2005 -- 5. Investment Ratio, 1997-2005 -- 6. Mean Financial Constraints by Industry, 1998-2005 -- Appendices -- A. Data Sources and Definitions -- B. Euler Equation Specification -- C. Estimating Total Factor Productivity -- References.
Abstract:
The global financial crisis has reopened the debate on the potential spillover effects from the financial sector to the real economy. This paper adds to that debate by providing new evidence on the link between finance and firm-level productivity, focusing on the case of Estonia. We contribute to the literature in two important respects: (i) we look explicitly at the role of financial constraints; and (ii) we develop a methodology that corrects for the misspecification problems of previous studies. Our results indicate that young and highly indebted firms tend to be more financially constrained. Overall, a large number of firms shows some degree of financial constraints, with firms in the primary sector being the most constrained. More importantly, we find that financial constraints do not lower productivity for most sectors.
Local Note:
Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2017. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries.
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