Does Diversification Create Value in the Presence of External Financing Constraints? Evidence from the 2008–2009 Financial Crisis

2010 ◽  
Author(s):  
Venkat Kuppuswamy ◽  
Belen Villalonga
Keyword(s):  
Financial Crisis ◽  
Financing Constraints ◽  
External Financing

scholarly journals Access to Credit of SMEs in the Czech Republic During the Financial Crisis and in the Post-crisis Period

2015 ◽  
Vol 63 (4) ◽  
pp. 1297-1302 ◽  
Author(s):  
Petr Koráb ◽  
Jitka Poměnková
Keyword(s):  
Czech Republic ◽  
Financial Crisis ◽  
Cash Holdings ◽  
Financing Constraints ◽  
External Financing ◽  
Financial Health ◽  
Firm Level ◽  
The Czech Republic ◽  
Access To Credit ◽  
The Impact

We investigate the impact of the financial crisis on the access of small and medium-sized enterprises in the Czech Republic to external financing. We apply the non-parametric kernel density estimation on a firm-level measure of financing constraints and evaluate its distribution on a balanced panel of SMEs. We focus on financing constraints related to financial health of companies since they determine the commercial banks’ lending behaviour. Our results reveal that firms were more constrained during the crisis and their financing constraints did not largely improve after the end of financial crisis. We argue that enterprises were financially constrained during the crisis because of reduced cash-flow and cash holdings.

A Different Perspective for the Financial Crisis in Latin America and the Caribbean

1985 ◽  
Vol 27 (4) ◽  
pp. 9-20 ◽  
Author(s):  
João Clemente Baena Soares
Keyword(s):  
Financial Crisis ◽  
Latin American ◽  
External Debt ◽  
Central American ◽  
South American ◽  
External Financing ◽  
Entire Region ◽  
Goods And Services ◽  
The Caribbean ◽  
Interest Payments

The Latin American and Caribbean countries are facing a serious financial crisis. External debt in the region is over $360 billion, and seven South American countries are among the ten largest debtors in the world. Interest payments alone required, in the years of 1982, 1983, and 1984, more than 35% of total regional exports of goods and services, a percentage which reached the extreme level of over 50% for one country. To be sure, this problem mostly affects the largest economies, since most of the Central American and Caribbean countries apply to interest payments less than 20% of their exports. The debt problem is a reality for the entire region, and it makes it difficult for all the countries to obtain new external financing.

Bilateral Aid Allocation for International Development: Impact of the Financial Crisis

2018 ◽  
Vol 2018 (4) ◽  
pp. 100-121
Author(s):  
Elena Balter ◽  
Aleksandra Morozkina
Keyword(s):  
Financial Crisis ◽  
International Development ◽  
Low Income ◽  
Development Assistance ◽  
Development Aid ◽  
Low Income Countries ◽  
External Financing ◽  
Bilateral Aid ◽  
The Impact ◽  
Allocation Decisions

This article examines the impact of financial crisis of 2008-2009 on allocation of development aid. Using OECD data on Official Development Assistance (ODA) allocation for international development by key donor countries, authors test three hypotheses: first, general impact of crisis on ODA allocation; second, impact of crisis on three recipient income groups; third, impact of crisis on relative importance of analyzed factors for ODA allocation decisions. The results show that general impact of crisis on ODA volumes was negative, although donors preferred to increase aid to low-income countries. Impact of factors describing economic situation in donor countries (public debt level, government expenditures and donor growth) increased after crisis. Donor countries might make use of these results to increase efficiency of their development assistance strategies, whereas recipient countries may exploit these results in order to attract more external financing for development.

Crowdfunding, Financing Constraints, and Real Effects

2020 ◽  
Vol 66 (8) ◽  
pp. 3561-3580 ◽  
Author(s):  
Praveen Kumar ◽  
Nisan Langberg ◽  
David Zvilichovsky
Keyword(s):  
Demand Uncertainty ◽  
Spot Price ◽  
Financing Constraints ◽  
Optimal Contract ◽  
External Financing ◽  
Real Effects ◽  
Discriminating Power ◽  
Individual Demand ◽  
Novel Interactions ◽  
The Cost

We study the feasibility and optimal design of presale crowdfunding contracts where participating consumers pay a premium above the future expected spot price and financially constrained entrepreneurs balance the potential product–market distortions introduced through presale crowdfunding against the cost of traditional external financing. Our analysis shows how such crowdfunding contracts enable the execution of projects that could not be otherwise undertaken and highlights novel interactions between the cost of capital, demand uncertainty, and production. Tighter financing constraints reduce the ability of the monopolist to extract surplus but, contrary to the usual result, may increase production. We evaluate how uncertainty and market size reduce the price-discriminating power of the monopolist and affect the optimal contract regime. Nevertheless, we show how such presale price-discriminating contracts are implementable even when the number of potential consumers is relatively high and their individual demand is stochastic. This paper was accepted by Gustavo Manso, finance.

scholarly journals Financing Constraints and Access to Credit in a Postcrisis Environment: Evidence from New Farmers in Alabama

2012 ◽  
Vol 44 (4) ◽  
pp. 607-621 ◽  
Author(s):  
Valentina Hartarska ◽  
Dennis Nadolnyak
Keyword(s):  
Financial Crisis ◽  
Survey Data ◽  
Credit Market ◽  
Cash Flows ◽  
Financing Constraints ◽  
2008 Financial Crisis ◽  
Access To Credit ◽  
Self Selection ◽  
The 2008 Financial Crisis ◽  
New Farmers

We use survey data to study the degree to which new farming operations in Alabama were financially constrained after the 2008 financial crisis. Next, we control for farmers' self-selection out of the credit market and identify which farmers were able to secure loans during the period of 2009–2010. The results show that new farmers that started any part of their operation after 2005 were financially constrained but no evidence that their financing constraints were affected by the crisis. As expected, we find that lending was collateral-driven, although lenders also considered farmers' profitability and cash flows.

scholarly journals Optimality of Morocco’s Currency Basket

2019 ◽  
Vol 2 (2) ◽  
pp. 97
Author(s):  
AZZOUZI Asmae ◽  
BOUSSELHAMI Ahmed
Keyword(s):  
Exchange Rate ◽  
Trade Balance ◽  
Foreign Currency ◽  
Financing Constraints ◽  
External Financing ◽  
Local Currency ◽  
Optimal Weights ◽  
Monetary Authorities ◽  
The Stability ◽  
The Impact

<p><em>The objective of this article is to analyze the behavior of the monetary authorities of Morocco in the readjustment of the official weights of anchor currencies in Dirham basket on April 13, 2015. To do this, we are taking into account the objective of the external financing constraints for comparing, with different scenarios, the optimal weights with the implicit weights of the currencies. Such a comparison proves that the authorities take more into consideration the structure of the commercial exchanges than that of the debt for the choice of the optimal weight of the anchor currency. In the final part of the paper, we have delved deeper into this issue by proposing a detailed sectoral study to examine the impact of the exchange rate on the trade balance for each activity sector. Our intention is to find out which foreign currency seems more volatile against the local currency in order to lead the economy to manage the stability of dirham by increasing its weight in the basket. As a result, the higher price elasticity of the Dollar against the dirham encourages Moroccan monetary authorities to increase its weight in the basket. </em></p>

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