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Dissecting the effect of credit supply on trade: evidence from matched credit-export data

Paravisini, Daniel, Rappoport, Veronica, Schnabl, Philipp and Wolfenzon, Daniel (2011) Dissecting the effect of credit supply on trade: evidence from matched credit-export data. NBER working paper, 16975. National Bureau of Economic Research, Massachusetts, USA.

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Abstract

We estimate the elasticity of exports to credit using matched customs and firm-level bank credit data from Peru. To account for non-credit determinants of exports, we compare changes in exports of the same product and to the same destination by firms borrowing from banks differentially affected by capital flow reversals during the 2008 financial crisis. A 10% decline in credit reduces by 2.3% the intensive margin of exports, by 3.6% the number of firms that continue supplying a product-destination, but has no effect on the entry margin. Overall, credit shortages explain 15% of the Peruvian exports decline during the crisis.

Item Type: Monograph (Working Paper)
Official URL: http://www.nber.org/
Additional Information: © 2011 The Authors
Library of Congress subject classification: H Social Sciences > HB Economic Theory
H Social Sciences > HG Finance
Journal of Economic Literature Classification System: F - International Economics > F1 - Trade > F10 - General
F - International Economics > F3 - International Finance > F30 - General
F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F40 - General
G - Financial Economics > G1 - General Financial Markets > G15 - International Financial Markets
G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
G - Financial Economics > G3 - Corporate Finance and Governance > G32 - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure
Sets: Departments > Finance
Collections > Economists Online
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: 16975
Date Deposited: 16 Apr 2012 13:10
URL: http://eprints.lse.ac.uk/43116/

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