Are politically connected firms less constrained in credit markets?

John Rand

No wp-2017-200, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: Utilizing a panel of over 2,000 Vietnamese SMEs over a 10-year period, we analyse the importance of being politically connected on both access and cost-of-credit obtained from formal financial institutions. Controlling for unobserved time-invariant firm-level heterogeneity, productivity self-selection concerns, and access to alternative credit markets, we show that political connections decreases the likelihood of being credit-constrained by 4 percentage points.

Keywords: Credit constraints; Political connections; Viet Nam (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (4)

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