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This paper analyzes the joint effect of EPL and financial market imperfections on investment, capital … stronger in firms with lower levels of internal resources. We find that, on average, EPL reduces investment per worker, capital … assess the average effect of EPL on firms' policies. Then, exploiting firm-level information we study if the effect of EPL is …
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Almost two decades after the introduction of the common currency, differences in institutional frameworks remain a major source of cross-country heterogeneity in the eurozone. We develop a two-country model with incomplete international markets in which the availability of credit depends on the...
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