Titulo: "Market Demand and Default Risk in Small Business Finance: Evidence from the Financial Crisis"
We analyze the eﬀect of an exogenous shock to demand in product markets on the default risk of small businesses. Using the 2007-2008 ﬁnancial crisis as exogeneous variation, we explore the fact that ﬁrms from export intense sectors were hit diﬀerently by the shock than ﬁrms from less export dependent sectors. We ﬁnd that the shock to market demand increased the default risk of ﬁrms from the more aﬀected production sector by 30 percent relative to the overall sample average default risk. This eﬀect is particularly pronounced in areas with ﬁercer bank competition. Higher default risk of ﬁrms may explain the more restrictive credit supply by lenders generally witnessed during a ﬁnancial crisis and is consistent with ﬁrms’ changed investment and ﬁnancing policies as a consequence of such a crisis.
Fecha y hora: 25 de julio de 2019 | 13:00 hrs
Lugar: Sala P302 (Diagonal Paraguay # 257, Santiago, Chile)
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