The impact of financial tightening on firm productivity: Maturity matters

Christian Abele, Agnès Benassy-Quere and Lionel Fontagné

Journal of International Money and Finance, 2024, vol. 144, issue C

Abstract: We analyse how the combination of firm-level financial fragility and country-level financial constraints affects productivity growth in France, Italy and Spain. We first show that, although high leverage weighs on firm-level productivity in all three countries, more leveraged firms seem to suffer more from financial constraints only in Italy. In a second step, we show that this apparent specificity of Italian firms is related to the relatively short maturity of their debt. These results highlight the importance of liquidity constraints during periods of financial stress such as the Global Financial Crisis of 2008 or the European sovereign debt and banking crisis of 2011-13.

Keywords: Total factor productivity; Firm-level data; Financial constraints; Crises (search for similar items in EconPapers)
JEL-codes: D24 E22 E23 E44 (search for similar items in EconPapers)
Date: 2024
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Working Paper: The impact of financial tightening on firm productivity: Maturity matters (2024)
Working Paper: The impact of financial tightening on firm productivity: Maturity matters (2024)
Working Paper: The impact of financial tightening on firm productivity: Maturity matters (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jimfin:v:144:y:2024:i:c:s0261560624000792

DOI: 10.1016/j.jimonfin.2024.103092

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