We examine whether low interest rates foster non-viable firms in Europe by analyzing two classes of firms: zombies and distressed. Controlling for the business cycle and recession periods, we find a significantly negative effect of short-term rates on the likelihood of being a zombie, while no...

We analyze the phenomenon of zombification in Europe and show that monetary policy alone is not its only driver. Concurring phenomena explain zombie and distressed firms’ prevalence. Using Compustat data on public firms, we find that a rise in short-term interest rates is associated with a...

The last decades have witnessed a significant increase in the share of zombie companies worldwide, i.e., companies which survive despite their inability to cover debt servicing costs from their current profits. Using extensive global firm-level data sets on publicly listed companies, we apply...

We examine whether low interest rates foster non-viable firms in Europe by analyzing two classes of firms: zombies and distressed. Controlling for the business cycle and recession periods, we find a significantly negative effect of short-term rates on the likelihood of being a zombie, while no...

We analyze how regional quality affects firm’s efficiency by identifying the impaired firms receiving financial assistance as those paying an implicit interest rate lower than the prime rate. Then, we decompose them into: real impaired firms unable to repay their loans, and those not repaying...

This study captures the presence of organized crime groups in the Italian territories and examines their relationship to firms that are in a condition of financial distress. At the end of the nineteenth century the first criminal groups emerged in the South of Italy as a response to the demand...

This paper analyzes the effects of product market competition on zombie firms in the US using a large sample of publicly traded firms. First, we show that the asset-weighted share of zombie firms at the industry level decreases significantly with more competition. This decrease is mostly...

This paper addresses and resolves the problems caused by microstructure effects when measuring the relative importance of home and U.S. market in the price discovery process of internationally cross listed stocks. In order to avoid large bounds for information shares, previous studies applying...