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Spring Forward or Fall Back? The Post-Crisis Recovery of Firms

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  • Leandro Medina

Abstract

This paper studies corporate performance in the aftermath of the global crisis by examining 6,581 manufacturing firms in 48 developed and developing countries in 2010, identifying factors of resilience as well as vulnerability. Based on a cross-sectional analysis, the results show that pre-crisis leverage and short-term debt have had negative effects on the speed of the recovery, while asset tangibility has had positive effects. The negative effect of leverage is non-linear, being particularly strong in firms with high pre-crisis leverage. Furthermore, the effects are different for advanced and emerging market economies. The paper also shows that the macroeconomic framework critically matters for firm growth. In particular, in countries that have allowed the exchange rate to depreciate, firms have had a faster recovery in sectors highly dependent on trade.

Suggested Citation

  • Leandro Medina, 2012. "Spring Forward or Fall Back? The Post-Crisis Recovery of Firms," IMF Working Papers 12/292, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:12/292
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Golikova Victoria & Kuznetsov Boris, 2016. "The Role of Innovation and Globalization Strategies in Post-Crisis Recovery," HSE Working papers WP BRP 123/EC/2016, National Research University Higher School of Economics.
    2. Mateja Gabrijelčič & Uroš Herman & Andreja Lenarčič, 2016. "Firm Performance and (Foreign) Debt Financing before and during the Crisis: Evidence from Firm-Level Data," Working Papers 15, European Stability Mechanism.
    3. Maria Gonzalez, 2012. "Nonfinancial Firms in Latin America; A Source of Vulnerability?," IMF Working Papers 12/279, International Monetary Fund.
    4. A. Arrighetti & F. Landini & A. Lasagni, 2015. "Firms’economic crisis and firm exit: do intangibles matters?," Economics Department Working Papers 2015-EP04, Department of Economics, Parma University (Italy).
    5. Peter Lindner & Sung Eun Jung, 2014. "Corporate Vulnerabilities in India and Banks' Loan Performance," IMF Working Papers 14/232, International Monetary Fund.
    6. Landini, Fabio & Arrighetti, Alessandro & Lasagni, Andrea, 2015. "Economic Crisis and Firm Exit: Do Intangibles Matter?," SEP Working Papers 2015/10, LUISS School of European Political Economy.

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