Arbeitspapier
Are politically connected firms less constrained in credit markets?
Utilizing a panel of over 2,000 Vietnamese SMEs over a 10-year period, we analyse the importance of being politically connected on both access and cost-of-credit obtained from formal financial institutions. Controlling for unobserved time-invariant firm-level heterogeneity, productivity self-selection concerns, and access to alternative credit markets, we show that political connections decreases the likelihood of being credit-constrained by 4 percentage points. Moreover, politically connected firms accessing credit face lower cost-of-capital than non-connected SMEs not excluded from formal financial markets. However, the impact of political connections is most valuable during periods of financial distress, but less prevalent during business cycle upswings.
- ISBN
-
978-92-9256-426-1
- Sprache
-
Englisch
- Erschienen in
-
Series: WIDER Working Paper ; No. 2017/200
- Klassifikation
-
Wirtschaft
- Thema
-
Credit constraints
political connections
Vietnam
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Rand, John
- Ereignis
-
Veröffentlichung
- (wer)
-
The United Nations University World Institute for Development Economics Research (UNU-WIDER)
- (wo)
-
Helsinki
- (wann)
-
2017
- DOI
-
doi:10.35188/UNU-WIDER/2017/426-1
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Rand, John
- The United Nations University World Institute for Development Economics Research (UNU-WIDER)
Entstanden
- 2017
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