Using a database of more than 1,100 firms in the MENA region, this article looks at the determinants of demand for trade credit, particularly access to bank credit, size, age and the quality of the firm's financial structure. We show that the difficulty of gaining acces to bank credit positively...

Complicated neoclassical models predict that if investment is sensitive to current financial performance, this is a sign that something is "wrong" and is to be regarded as a problem for policy. Evolutionary theory, on the other hand, refers to the principle of "growth of the fitter" to explain...

This paper surveys issues with respect to the structural modelling of econometric tests of investment facing financial constraints, to their link with firms data and asset prices, and to their consequences for macroeconomic modelling. The key issue is to provide conditions which support the...

Using a large cross-country, firm level database containing 5,000 firms in 9 developing and emerging economies, we study how financial factors affect both firms' export decisions and the amount exported by firm. First, our results stress an important impact of firms' access to finance on their...

We develop a simple model to study the interactions between a supplier's financial constraints and contract incompleteness in a vertical relationship. Production complexity increases the extent of contract incompleteness and the hold-up problem, which generates a cost when the supplier needs...

We explore whether financial constraints matter and which financial constraints matter the most in the choice of becoming an entrepreneur. We exploit a randomly assigned welfare program in rural Mexico to show that cash transfers significantly increase entry into entrepreneurship, thereby...

Financial constraints affecting new firms are some of the factors most cited forimpeding entrepreneurial dynamics from flourishing. This article introduces the problem ofregional patterns of financial constraints. The research is conducted with regard to the Frenchregions and the new French...

We examine the relation between cash holdings, quality of governance and financial constraints. We find that firms with strong shareholder rights hold more cash, contrary to the predictions of agency theory. This result is partly due to the positive correlation that exists between governance...

This paper focuses on the effects of financial factors on manufacturing firms' export participation. Using a simple dynamic discrete choice model, we first present the intuition according to which financial constraints reduce the probability of exporting. Then, based on a panel of Egyptian...

In the aftermath of the recent bank-centered financial crisis it is still unclear how much of the decline in non-financial firms' stock prices was due to liquidity shortage, and how much of this decline was due to lower expected consumer demand. The stock returns are examined over nine periods...