Paravisini, Daniel, Rappoport, Veronica, Schnabl, Philipp and Wolfenzon, Daniel (2015) Dissecting the effect of credit supply on trade: evidence from matched credit-export data. The Review of Economic Studies, 82 (1). pp. 333-359. ISSN 0034-6527
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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. We find that credit shocks affect the intensive margin of exports, but have no significant impact on entry or exit of firms to new product and destination markets. Our results suggest that credit shortages reduce exports through raising the variable cost of production, rather than the cost of financing sunk entry investments.
| Item Type: | Article |
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| Official URL: | http://www.restud.com/ |
| Additional Information: | © 2014 The Review of Economic Studies Limited |
| Library of Congress subject classification: | H Social Sciences > HG Finance |
| Sets: | Departments > Finance Departments > Management Research centres and groups > Managerial Economics and Strategy Group |
| Funders: | Jerome A. Chazen Institute of International Business |
| Date Deposited: | 30 Sep 2014 10:32 |
| URL: | http://eprints.lse.ac.uk/59575/ |
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