SME failures under large liquidity shocks : an application to the COVID-19 crisis / by Pierre-Olivier Gourinchas, Şebnem Kalemli-Özcan, Veronika Penciakova and Nick Sander. : FB3-5/2023-32E-PDF

"We study the effects of financial frictions on firm exit when firms face large liquidity shocks. We develop a simple model of firm cost-minimization that introduces a financial friction that limits firms’ borrowing capacity to smooth temporary shocks to liquidity. In this framework, firm exit arises from the interaction between this financial friction and fluctuations in cash flow due to aggregate and sectoral changes in demand conditions, as well as more traditional shocks to productivity. To evaluate the implications of our model, we use firm-level data on small and medium-sized enterprises (SMEs) in 11 European countries"--Abstract.

Lien permanent pour cette publication :
publications.gc.ca/pub?id=9.927517&sl=1

• Format MARC XML
• Format MARC HTML

Demander des formats alternatifs