EconPapers    
Economics at your fingertips  
 

Small and Vulnerable: Small Firm Productivity in the Great Productivity Slowdown

Sophia Chen () and Do Lee

No 2020/294, IMF Working Papers from International Monetary Fund

Abstract: We provide broad-based evidence of a firm size premium of total factor productivity (TFP) growth in Europe after the Global Financial Crisis. The TFP growth of smaller firms was more adversely affected and diverged from their larger counterparts after the crisis. The impact was progressively larger for medium, small, and micro firms relative to large firms. It was also disproportionally larger for firms with limited credit market access. Moreover, smaller firms were less likely to have access to safer banks: those that were better capitalized banks and with a presence in the credit default swap market. Horseraces suggest that firm size may be a more important and robust vulnerability indicator than balance sheet characteristics. Our results imply that the tightening of credit market conditions during the crisis, coupled with limited credit market access especially among micro, small, and medium firms, may have contributed to the large and persistent drop in aggregate TFP.

Keywords: Credit constraint; Financial crisis; Firm size; Intangibles; Producvitity; SMEs; WP; TFP growth; creditor bank; size premium; credit market access; micro firm; vulnerability indicator (search for similar items in EconPapers)
Pages: 51
Date: 2020-12-18
New Economics Papers: this item is included in nep-bec, nep-eff, nep-ent, nep-fdg and nep-sbm
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.imf.org/external/pubs/cat/longres.aspx?sk=49964 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2020/294

Ordering information: This working paper can be ordered from
http://www.imf.org/external/pubs/pubs/ord_info.htm

Access Statistics for this paper

More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().

 
Page updated 2024-05-16
Handle: RePEc:imf:imfwpa:2020/294