The Cross-sectional and Time-Series Dynamics of Corporate Finance: Empirical evidence from financially constrained firms
This dissertation discusses the access to finance of mostly financially constrained firms on several dimensions. The first study investigates the relationship between corporate leverage and the asset structure. It appears that non-current assets are more important sources of collateral than current assets. The collateral channel is more pronounced for bank-dependent firms, but it weakened the most for these firms during the crisis. The second study investigates whether SMEs receive more trade credit after they experienced a negative shock to bank credit. This ability to substitute depends in a positive way on the credit quality of the firms and the stage of the economy. Moderately financially constrained firms are most likely to substitute. The third study investigates how several variables related to banking sector development, stock market development and legal development affect the access to SME finance. The main finding is that SME’s have better access to finance if they are located in countries with a competitive banking sector, with a strong preference for long debt maturity, with high quality credit registries, with liquid and low-volatile stock markets and with strong creditor protection rights.