We study the role of export credit agencies--the predominant tool of industrial policy--on firm behavior by using the effective shutdown of the Export-Import Bank of the United States (EXIM) from 2015-2019 as a natural experiment. We show that firms that previously relied on EXIM support saw a...

Inter-industry trade and foreign trade are usually not based on cash transactions; rather sales on credit are the rule. The resulting monitoring costs for lenders and the risk of default on accounts receivable form an additional part of transaction costs in trade. Export credit certainly faces...