The heterogeneous response of domestic sales and exports to bank credit shocks
Ines Buono () and
Journal of International Economics, 2018, vol. 113, issue C, 55-73
This paper analyzes how bank credit affects foreign and domestic sales. We use Italian matched bank-firm data and exploit bank mergers and acquisitions as a novel instrument to establish a causal link. We find that shocks to the supply of bank credit induce exporters to decrease their export flows, without affecting their domestic sales. On the other hand, non-exporters react by reducing their domestic sales. We argue that these differences are not driven by the kind of flow, but by the kind of firm: exporters and non-exporters differ in how they can react when facing credit constraints.
Keywords: Export; Sales; Bank lending channel; Credit shocks; Mergers and acquisitions (search for similar items in EconPapers)
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Working Paper: The heterogeneous response of domestic sales and exports to bank credit shocks (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:113:y:2018:i:c:p:55-73
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