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Credit Contraction and International Trade: Evidence from Chilean Exporters

Author

Listed:
  • Ari Aisen
  • Roberto Álvarez
  • Andrés Sagner
  • Javier Turén

Abstract

An important consequence of the recent financial crisis was the collapse of global trade. Using data of Chilean exporting firms, this paper studies the effect of financial constraints on export growth in the aftermath of the crisis. Our results show that both overall financing and export credit were significant determinants of export contraction in the Chilean case. However, the effect is highly heterogeneous. The evidence shows that larger exporters, belonging to industries more dependent on overall credit, have suffered disproportionately more. This has important policy implications, as public policy aiming at stimulating trade credit may not be as effective if overarching credit conditions remain subdued.

Suggested Citation

  • Ari Aisen & Roberto Álvarez & Andrés Sagner & Javier Turén, 2011. "Credit Contraction and International Trade: Evidence from Chilean Exporters," Working Papers Central Bank of Chile 639, Central Bank of Chile.
    • Handle: RePEc:chb:bcchwp:639
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    Cited by:

    1. Lo Turco, Alessia & Maggioni, Daniela, 2014. "The micro evolution of trade and turnover in Turkey under the global crisis," Economic Systems, Elsevier, vol. 38(3), pages 397-414.
    2. Alvaro Aguirre, 2017. "Contracting Institutions and Economic Growth," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 24, pages 192-217, March.
    3. Кокорева Мария Сергеевна & Степанова Анастасия Николаевна, 2012. "Financial architecture and corporate performance: evidence from Russia," Journal of Corporate Finance Research Корпоративные финансы, CyberLeninka;Федеральное государственное автономное образовательное учреждение высшего образования «Национальный исследовательский университет «Высшая школа экономики», issue 2 (22), pages 34-44.
    4. International Monetary Fund, 2012. "Chile: Selected Issues," IMF Staff Country Reports 2012/266, International Monetary Fund.
    5. Caetani, Maria Inês & Alvim, Augusto Mussi & Hubbard, Carmem, 2015. "The Effects of the Costs of Trade Transaction and Free Trade in the International Soy Market," 89th Annual Conference, April 13-15, 2015, Warwick University, Coventry, UK 204202, Agricultural Economics Society.
    6. Mr. Yi Wu, 2012. "Performance of Publicly Listed Chilean Firms During the 2008-2009 Global Financial Crisis," IMF Working Papers 2012/261, International Monetary Fund.
    7. Youngwoo Rho & Joel Rodrigue, 2015. "Growing into Export Markets: The Impact of Exporting on Firm-level Investment in Indonesia," Review of International Economics, Wiley Blackwell, vol. 23(1), pages 62-85, February.
    8. Roberto Álvarez & Camila Sáez, 2015. "Post-Crisis Financiera y Expansión de las Exportaciones: Micro-Evidencia para Chile," Working Papers Central Bank of Chile 748, Central Bank of Chile.
    9. Álvarez, Roberto & Sáez, Camila, 2014. "“Post financial crisis and exports expansion: Micro-evidence from Chilean exporters”," MPRA Paper 60637, University Library of Munich, Germany.
    10. Sulthon Sjahril Sabaruddin & Hartanti Nugrahaningsih, 2013. "Assessing Indonesia-Chile bilateral trade opportunities: A revealed comparative advantage approach," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 5(1), pages 45-56, April.

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