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Export market exit, financial pressure and the crisis

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  • Görg, Holger
  • Spaliara, Marina-Eliza

Abstract

Using firm-level data for the UK, we investigate the link between firms' financial health, borrowing ratio and export exit, paying special attention to the recent financial crisis. Our results show that deterioration in the financial position of firms has increased the hazard of export exit during the crisis. We also find that the sensitivity of export exit to changes in firms' financial condition is higher during the crisis for those firms which face increases in loan spreads associated with the firm-specific interest rate.

Suggested Citation

  • Görg, Holger & Spaliara, Marina-Eliza, 2013. "Export market exit, financial pressure and the crisis," Kiel Working Papers 1859, Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwkwp:1859
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    Cited by:

    1. Spiros Bougheas & Hosung Lim & Simona Mateut & Paul Mizen & Cihan Yalcin, 2018. "Foreign currency borrowing, exports and firm performance: evidence from a currency crisis," The European Journal of Finance, Taylor & Francis Journals, vol. 24(17), pages 1649-1671, November.
    2. repec:wsr:wpaper:y:2016:i:162 is not listed on IDEAS
    3. Peter S. Eppinger & Nicole Meythaler & Marc-Manuel Sindlinger & Marcel Smolka, 2018. "The great trade collapse and the Spanish export miracle: Firm-level evidence from the crisis," The World Economy, Wiley Blackwell, vol. 41(2), pages 457-493, February.
    4. Joachim Wagner, 2016. "Credit Constraints and Exports: A Survey of Empirical Studies Using Firm Level Data," World Scientific Book Chapters, in: Microeconometrics of International Trade, chapter 12, pages 401-421, World Scientific Publishing Co. Pte. Ltd..
    5. Irlacher, Michael & Unger, Florian, 2018. "Capital market imperfections and trade liberalization in general equilibrium," Journal of Economic Behavior & Organization, Elsevier, vol. 145(C), pages 402-423.
    6. 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.
    7. Álvarez, Roberto & Sáez, Camila, 2014. "“Post financial crisis and exports expansion: Micro-evidence from Chilean exporters”," MPRA Paper 60637, University Library of Munich, Germany.
    8. Holger Breinlich & Patrick Nolen & Greg C Wright, 2020. "Is publicly-reported firm-level trade data reliable? Evidence from the UK," PLOS ONE, Public Library of Science, vol. 15(11), pages 1-10, November.
    9. Laura M. Werner, 2020. "Hysteresis losses in the Preisach framework," Empirical Economics, Springer, vol. 58(3), pages 1249-1278, March.
    10. Huang, Xiaobing, 2017. "Exchange rate movements and export market dynamics: Evidence from China," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 11, pages 1-27.

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    More about this item

    Keywords

    financial pressure; firm exit; financial health; exports;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • G3 - Financial Economics - - Corporate Finance and Governance

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