1. Access to Finance and Job Growth : Firm-Level Evidence across Developing Countries
- Author
-
Ayyagari, Meghana, Juarros, Pedro, Martinez Peria, Maria Soledad, and Singh, Sandeep
- Subjects
INVESTMENT ,PUBLIC CREDIT ,CORPORATION ,INFRASTRUCTURE ,CREDIT RELATIONSHIPS ,ECONOMIC GROWTH ,EMPLOYMENT GROWTH ,INFLATION ,FINANCING ,EXTERNAL FINANCING ,OUTSTANDING LOAN ,FIRM SIZE ,EMPLOYMENT ,CREDITOR ,CRITERIA ,INSTITUTIONAL REFORM ,FINANCIAL INTERMEDIATION ,LENDING ,MORTGAGE MARKET ,UNEMPLOYMENT ,SUPPLY OF CREDIT ,RECESSION ,FINANCIAL INFRASTRUCTURE ,PRODUCTIVITY ,EXPANSION ,GOVERNMENTS ,NONPROFIT ORGANIZATION ,BANK BRANCH ,COLLATERAL ,FIRM ,BANK ,INFORMATION SHARING ,LOANS ,MEDIUM ENTERPRISES ,FINANCIAL SYSTEMS ,STRATEGIES ,MORTGAGE ,LONG TERM FINANCING ,FINANCIAL MARKETS ,FIRMS ,BORROWERS ,INDUSTRY ,MARKETS ,CREDITORS ,FINANCE ,INTERNATIONAL FINANCE ,LINE OF CREDIT ,FIXED COST ,BANKING INDUSTRY ,FINANCIAL DEPTH ,LABOR MARKET ,ENTERPRISES ,CREDIT BUREAU ,REGULATORY REFORM ,JOB LOSSES ,SOURCES OF FINANCE ,DEBT ,MARKET ,ACCESS TO LOAN ,CAPITAL EXPENDITURES ,PROPERTY ,CASH FLOW ,EQUALITY ,FIXED ASSET ,ECONOMIC DEVELOPMENT ,ACCESS TO FINANCE ,PHYSICAL CAPITAL ,ECONOMIC ACTIVITY ,PROPERTIES ,FIXED ASSETS ,SALES GROWTH ,CREDIT CONSTRAINTS ,CAPITAL ,BUSINESS ENVIRONMENT ,GREATER ACCESS ,VALUE ,RISK ,SME FINANCE ,ENTERPRISE ,SME ,CREDIT INFORMATION ,CAPITAL MARKETS ,ECONOMETRICS ,GOVERNANCE ,CREDITWORTHINESS ,FINANCIAL INFRASTRUCTURES ,SEE ,CORPORATE FINANCE ,SUPPLIERS ,FINANCIAL SYSTEM ,BIAS ,FINANCIAL INSTITUTIONS ,INVESTMENT DECISIONS ,CREDIT BUREAUS ,LENDING SHOCKS ,EMPLOYEES ,CREDIT REPORTING ,CREDIT ACCESS ,PRIVATE CREDIT ,BANKS ,FINANCIAL INSTITUTION ,UNION ,ECONOMIC POLICY ,BORROWING ,LOAN ,BANKING CRISES ,CREDIT ,ACCESS TO CREDIT ,EXPENDITURES ,FINANCIAL ACCESS ,BANK CREDIT ,FINANCIAL DEVELOPMENT ,INTERNATIONAL BANK ,FINANCIAL RESOURCES ,STOCK MARKETS ,CREDIT REGISTRIES ,LABOR ,LABOR MARKETS ,INTEREST ,EXTERNAL FINANCE ,JOB CREATION ,CREDIT MARKETS ,CAPITAL ACCUMULATION ,SMALL FIRMS ,BRANCH ,FINANCIAL STRUCTURE ,FINANCING NEEDS ,CREDIT MARKET ,EXPENDITURE - Abstract
This paper investigates the effect of access to finance on job growth in 50,000 firms across 70 developing countries. Using the introduction of credit bureaus as an exogenous shock to the supply of credit, the paper finds that increased access to finance results in higher employment growth, especially among micro, small, and medium enterprises. The results are robust to using firm fixed effects, industry measures of external finance dependence, and propensity score matching in a complementary panel data set of more than four million firms in 29 developing countries. The findings have implications for policy interventions targeted to produce job growth in micro, small, and medium enterprises.
- Published
- 2016