Using a representative sample of European firms, this paper studies whether and to what extent financing constraints … administrative data on financial statements to develop an index of financing constraints. It estimates that a 10 percent increase in … facing tighter financing constraints cut back the investment in training and tangible assets less than investment in R&D and …

Using a representative sample of European firms, we study whether and to what extent financing constraints affect … financial statements to develop an index of financing constraints. We estimate that a 10 percent increase in this index reduces ….5 percent. We document that lower investment in training reduces productivity, and show that firms facing tighter financing …