WHERE ARE THE FRAGILITIES? THE RELATIONSHIP BETWEEN FIRMS' FINANCIAL CONSTRAINTS, SIZE, AND AGE

Carlos Carreira () and Filipe Silva ()

Chapter 10 in Managing Structural Changes - Trends and Requirements, 2012, vol. 1, pp 184-198 from Institute of Economic Sciences

Abstract: Recessions and financial crisis increase financial constraints and disproportionally affect constrained firms. This Chapter investigates the differences in firms’ financial constraints between sectors using a cash to cash-flow rationale (Almeida et al., 2004) and a firm specific index of constraints (Hovakimien and Hovakimien, 2009). Interpreting higher sensitivities of cash to cash flow as evidence of higher constraints, we find that the relationships between firm size, firm age and constraints are, in general, non-monotonic and not robust to economic sector disaggregation, which contrasts with previous findings.

Keywords: Financial constraints; financial crises; firm size; firm age; firm-level studies; Portugal (search for similar items in EconPapers)
Date: 2012
ISBN: 978-972-9344-06-0
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Where Are the Fragilities? The Relationship Between Firms' Financial Constraints, Size, and Age (2012)
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