Financial Development, Endogenous Dependence on External Financing, and Trade
Bibliographic Data
| ID | 9724474 |
|---|---|
| Authors | Byeonghwa Choi (0000-0001-5711-2896, National Taiwan University, corresponding author) |
| Year | 2020 |
| Volume | 87 |
| Issue | 346 |
| Pages | 530-587 |
| Publication date | 2020-04-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Economica (JOURNAL) |
| Journal identifiers | ISSN: 0013-0427 • E-ISSN: 1468-0335 |
| Publisher | Wiley (PUBLISHER • GB) |
| DOI | 10.1111/ecca.12309 |
| OpenAlex | W2937091645 |
| Language | EN |
| Citations received | 2 |
| References cited | 58 |
Influential papers on how credit constraints affect international trade have shown a tendency to assume that asset tangibility and the share of external borrowing are exogenous industry characteristics that are time‐ and country‐invariant. In the finance literature, however, the share of external borrowing is viewed as endogenous and dependent on the amount of collateral that a firm can provide (and thus, implicitly, on its asset tangibility). Drawing from the finance literature, I hypothesize that there are supply‐side factors that exert substantial influences on the share of external financing. I test this new perspective with country‐ and industry‐specific measures of asset tangibility and external borrowing. I find that (i) the share of external borrowing increases in asset tangibility, and (ii) the sectoral rankings of asset tangibility and the share of external borrowing vary significantly across countries. Further, I develop a theoretical model to investigate the impact of financial development and asset tangibility on the demand and supply of external finance and exports. The model yields theoretical predictions that are consistent with, and provide intuition for, the above results. Both the model and my empirical results demonstrate that industries with more tangible assets export more from countries with high levels of financial development
Asset (computer security) · Business · Collateral · Debt · Economics · External financing · Intuition · Monetary economics · Finance · Global Financial Crisis and Policies · Global trade and economics · International Development and Aid
Productivity Differences
Finance and the sources of growth
Financial factors and exporting decisions
Finance and Development
Financial development and international trade
Across-Product Versus Within-Product Specialization in International Trade
Income Distribution and Macroeconomics
Finance and Growth
Introducing a New Broad-based Index of Financial Development
Exports and Financial Shocks
Credit Constraints, Heterogeneous Firms, and International Trade
Corporate financing and investment decisions when firms have information that investors do not have
Chapter 12 Finance and Growth
Too much finance?
Market Size, Trade, and Productivity
Finance, entrepreneurship and growth
The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity
North-South Trade, Employment and Inequality
Finance and trade
Financial factors and the margins of trade
What matters for financial development? Capital controls, institutions, and interactions
Law and Finance
Financial Development and International Trade
Credit Cycles
Financial Health, Exports and Firm Survival
Export and Innovation in Small and Medium Enterprises
| Unique citing works | 2 |
|---|---|
| Citations per year | 0,5 |
| Citation span | 2022 - 2024 (3) |
| Citation velocity | recent |
| Highly cited | No |
| Citation types | Neutral: 2 |