Financing Labor*

Corporate debt maturity and the real effects of the 2007 credit crisis

Efraim Benmelech, Nittai Bergman and Amit Seru

Review of Finance, 2021, vol. 25, issue 5, 1365-1393

Abstract: Financial market imperfections can have significant impact on employment decisions of firms. We illustrate the economic importance of this channel by showing that employment decisions are constrained by firms’ financial health and liquidity. Our main analysis uses a collage of three “quasi-experiments” to trace the effects of finance on employment. The results suggest that financial constraints and the availability of credit play an important role in firm-level employment decisions, as well as aggregate unemployment outcomes.

Keywords: Financial constraints; Labor; Employment (search for similar items in EconPapers)
JEL-codes: E24 E51 G32 G33 J64 (search for similar items in EconPapers)
Date: 2021
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Working Paper: Financing Labor (2011)
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