Credit Constraints, Cyclical Fiscal Policy and Industry Growth

Philippe Aghion, David Hemous and Enisse Kharroubi

Scholarly Articles from Harvard University Department of Economics

Abstract: What are the effects of cyclical fiscal policy on industry growth? We show that industries with a relatively heavier reliance on external finance or lower asset tangibility tend to grow faster (in terms of both value added and of labor productivity growth) in countries that implement fiscal policies that are more countercyclical. We reach this conclusion using Rajan and Zingales׳s (1998) difference-in-difference methodology on a panel data sample of manufacturing industries across 15 OECD countries over the period 1980–2005.

Date: 2014
New Economics Papers: this item is included in nep-mac and nep-tid
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Published in Journal of Monetary Economics

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Related works:
Working Paper: Credit Constraints, Cyclical Fiscal Policy and Industry Growth (2009)
Working Paper: Credit Constraints, Cyclical Fiscal Policy and Industry Growth (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:hrv:faseco:12585130

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