Съдържанието не е налично на български език.
Annalisa Ferrando
Monetary Policy
- Division
-
Capital Markets/Financial Structure
- Current Position
-
Senior Lead Economist
- Fields of interest
-
Microeconomics,Financial Economics,Law and Economics
- Education
- 1988-1990
M.Phil. in Economics, University of Oxford, UK
- 1987-1988
Diploma in Economia e Gestione Aziendale, Scuola Superiore E. Mattei, Milan, Italy
- 1981-1987
Degree in Economics, University of Venice, Venice, Italy
- Professional experience
- 2006-2018
ECB, Principal Economist, Directorate Monetary Policy
- 2017
EIB, nov. 2016- oct. 2017, Advisor on secondment, Economics Department
- 2000-2006
ECB, Senior Economist, Directorate Monetary Policy
- 2001-2002
ECB, Consultant on the project "Bank lending survey in the EMU"
- 1998-2000
European Commission, National Expert, Direction General Enterprise
- 1991-1997
Banca d' Italia, Economist, Research Department
- Awards
- 2021
2021 New Zealand Association of Economists. meeting: Stata Prize for Excellence in Graphics Communications. Paper title: "Monetary policy, investment and firm heterogeneity"
- 2019
2019 Behavioural Finance Working Group Conference: Best Quantitative Paper Award sponsored by Review of Behavioral Finance. Paper title: "What were they thinking? Firms' expectations on the availability of external finance"
- 2018
World Finance and Banking Symposium 2018: Best Paper Award. Paper title: “Investment of financially distressed firms: the role of trade credit”
- 2018
European Financial Management : 2017 Readers' Choice Best Paper Award. Paper title: “Financial Flexibility and investment ability across the euro area and the UK”
- Teaching experience
- 1990
Lecturer in Economics, St. Peter's College, Oxford University, October 1990- March 1991
- 7 July 2022
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 5, 2022Details
- Abstract
- This box analyses the selling price expectations among euro area firms based on the results from the most recent Survey on the Access to Finance of Enterprises in the euro area. To better understand the price-setting behaviour of firms in a context of high inflationary pressures, the April 2022 Survey included additional questions on the selling price expectations of firms and factors influencing their pricing decisions. By providing the perspective of firms, this box sheds light on the current inflation outlook.
- JEL Code
- C83 : Mathematical and Quantitative Methods→Data Collection and Data Estimation Methodology, Computer Programs→Survey Methods, Sampling Methods
D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
D84 : Microeconomics→Information, Knowledge, and Uncertainty→Expectations, Speculations
L11 : Industrial Organization→Market Structure, Firm Strategy, and Market Performance→Production, Pricing, and Market Structure, Size Distribution of Firms
- 13 January 2022
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 8, 2021Details
- Abstract
- This box explores new indicators of the financing conditions faced by euro area companies, based on firm-level survey data. Drawing on the rich dataset provided by the survey on the access to finance of enterprises (SAFE), three synthetic indicators summarise how firms have perceived their financing conditions in the euro area since 2009. Overall, the indicators suggest there have been several important phases in firms’ perceptions of financing conditions, which relate closely to ECB monetary policy measures. The empirical analysis shows that, after the onset of the pandemic, firms’ perceptions of financing conditions played an increasingly important role in explaining their expectations of the future availability of bank loans.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
H32 : Public Economics→Fiscal Policies and Behavior of Economic Agents→Firm
- 21 December 2021
- WORKING PAPER SERIES - No. 2632Details
- Abstract
- Monetary policy aims at affecting corporate borrowing by influencing the marginal costs of firms, but its potency can be conditioned by the degree of market competition. We first identify conditions under which changes in marginal costs may have different effects on credit constraints and output under different competitive environment, in a simple Cournot competition setting. We then exploit changes in monetary policy to examine whether the pass-through of borrowing costs is affected by market structure. First, we use as an experiment the announcement of the ECB Outright Monetary Transactions (OMT) program in a triple-differences specification. We show that small firms (which have low market power and higher credit constraints) in "stressed" countries (which benefited more from the policy) within less concentrated sectors experienced a larger reduction in credit constraints than similar firms in more concentrated sectors. Second, we exploit continuous state-of-the-art measures of monetary policy shocks to study how market structure affects pass-through to real variables, like investment and sales growth. We find evidence that firms with more market power respond less to monetary policy shocks. These results show that the interaction of borrowing capacity and market structure matters, and that concentration may have important effects on monetary policy transmission.
- JEL Code
- D4 : Microeconomics→Market Structure and Pricing
E4 : Macroeconomics and Monetary Economics→Money and Interest Rates
E5 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit
L1 : Industrial Organization→Market Structure, Firm Strategy, and Market Performance - Network
- Discussion papers
- 6 October 2021
- WORKING PAPER SERIES - No. 2598Details
- Abstract
- We study the transmission of (unconventional) monetary policy to the real sector when firm decisions depend on both current and future credit market conditions. For a given level of current credit access, investment and employment increases more at firms expecting bank credit to improve in the future. Three separate unconventional policies by the ECB—the OMT, the introduction of negative rates, and the CSPP—improved expectations of future credit access for SMEs borrowing from banks that were expected to increase SME lending due to the policy. Our results enhance our understanding of the bank balance sheet channel of monetary policy.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
D84 : Microeconomics→Information, Knowledge, and Uncertainty→Expectations, Speculations
E58 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Central Banks and Their Policies
G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
H63 : Public Economics→National Budget, Deficit, and Debt→Debt, Debt Management, Sovereign Debt - Network
- Research Task Force (RTF)
- 21 September 2021
- OCCASIONAL PAPER SERIES - No. 270Details
- Abstract
- The financing structure of the euro area economy has evolved since the global financial crisis with non-bank financial intermediation taking a more prominent role. This shift affects the transmission of monetary policy. Compared with banks, non-bank financial intermediaries are more responsive to monetary policy measures that influence longer-term interest rates, such as asset purchases. The increasing role of debt securities in the financing structure of firms also leads to a stronger transmission of long-rate shocks. At the same time, short-term policy rates remain an effective tool to steer economic outcomes in the euro area, which is still highly reliant on bank loans. Amid a low interest rate environment, the growth of market-based finance has been accompanied by increased credit, liquidity and duration risk in the non-bank sector. Interconnections in the financial system can amplify contagion and impair the smooth transmission of monetary policy in periods of market distress. The growing importance of non-bank financial intermediaries has implications for the functioning of financial market segments relevant for monetary policy transmission, in particular the money markets and the bond markets.
- JEL Code
- E4 : Macroeconomics and Monetary Economics→Money and Interest Rates
E5 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit
G2 : Financial Economics→Financial Institutions and Services
G38 : Financial Economics→Corporate Finance and Governance→Government Policy and Regulation
- 23 June 2021
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 4, 2021Details
- Abstract
- European governments responded to the pandemic by deploying large fiscal packages with the aim of supporting households, workers and firms. The October 2020-March 2021 SAFE shows that around two-thirds of large firms and SMEs surveyed made use of government policy support measures. Most firms used these schemes, particularly in the form of wage support measures, tax cuts and tax moratoria, to cover their immediate and short-term liquidity needs. Firms also indicated that government measures either currently in place or planned would make it easier for them to meet their debt obligations in the next two years. This demonstrates how government policies have been key to easing the liquidity needs of firms in the short and medium term following the outbreak of the pandemic.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
H32 : Public Economics→Fiscal Policies and Behavior of Economic Agents→Firm
- 25 November 2020
- RESEARCH BULLETIN - No. 77Details
- Abstract
- We set out to analyse the monetary policy transmission mechanism by documenting how the annual investment of more than one million firms in Germany, Spain, France and Italy responded to monetary policy shocks between 2000 and 2016. We show that euro area firms react differently depending on their age and the industry they operate in: young firms and those producing durable goods react more strongly than the average firm. This confirms that monetary policy is affecting firms’ investment through two different channels. On the one hand, the “interest rate channel” affects demand for durable goods more than demand for services, which in turn affects investment demand from the producers of those goods. On the other hand, as young firms are more likely to face financing constraints, their stronger than average reaction can be explained by the “balance sheet channel” of monetary policy transmission.
- JEL Code
- E22 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Capital, Investment, Capacity
E52 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Monetary Policy
- 20 July 2020
- WORKING PAPER SERIES - No. 2446Details
- Abstract
- This paper provides novel information on the propagation of the pandemic-induced real shock to firms’ financial conditions. It uses firm-level survey data from end February to early April 2020 for a large sample of euro area SMEs and large firms. Firms’ expectations on the availability of credit lines, bank loans and trade credit deteriorated significantly in the first half of March. Firms mostly expected to be affected if they had previously difficulties in securing finance, had higher indebtedness and, hence, less capacity to deal with a liquidity shock. Conditional on these factors, firm size does not seem to matter, except for trade credit, in which case SMEs had more positive conditional expectations. Together with the overall deterioration of expectations, there seems to have also been a reallocation of opportunities to access finance amidst the crisis. Small firms were more likely to have conditional expectations of improvement in their access to finance.
- JEL Code
- C83 : Mathematical and Quantitative Methods→Data Collection and Data Estimation Methodology, Computer Programs→Survey Methods, Sampling Methods
D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
D84 : Microeconomics→Information, Knowledge, and Uncertainty→Expectations, Speculations
E65 : Macroeconomics and Monetary Economics→Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook→Studies of Particular Policy Episodes
L25 : Industrial Organization→Firm Objectives, Organization, and Behavior→Firm Performance: Size, Diversification, and Scope
- 17 June 2020
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 4, 2020Details
- Abstract
- This box presents evidence on the impact of the coronavirus (COVID-19) crisis among small and medium-sized enterprises (SMEs) based on the results of the 22nd round of the Survey on the Access to Finance of Enterprises (SAFE).
- JEL Code
- D22, E58, G32 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
- 16 June 2020
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 4, 2020Details
- Abstract
- Using information derived from the survey on the access to finance of enterprises (SAFE), this article provides an overview of the changes in the financing conditions experienced by euro area companies over the last ten years. The focus is on non-financial small and medium-sized enterprises (SMEs). Following the Global Financial Crisis and during the subsequent euro area sovereign debt crisis, access to external finance for these firms was severely impaired. This was followed by a steady improvement in financial conditions, particularly due to support from the accommodative monetary policy measures introduced since 2012. Despite a gradual improvement since the mid-2010s, challenges for SMEs’ access to finance remained, for example in terms of funding diversification, even before the coronavirus (COVID-19) crisis started at the end of 2019. The outbreak of the recent pandemic raised some new, severe and immediate challenges for SMEs in terms of their access to financing. An accompanying box in this issue of the Economic Bulletin summarises the results of the latest SAFE survey, which took place in March and April 2020, in the midst of the coronavirus crisis.
- JEL Code
- D22, E58, G32 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
- 15 June 2020
- WORKING PAPER SERIES - No. 2420Details
- Abstract
- We propose a new methodology to recover firm-time varying financial constraints from firms’ production behavior. We model financial constraints as the profitability that firms forgo when budget constraints on production inputs bind, impeding them from using the optimal level of inputs and technology. We estimate and validate our measure using unique data combining firms’ balance sheets with survey information on self-reported financial constraints, like loan rejections. In contrast to three popular indices of financial constraints, our measure recovers financial constraints beyond observable firm characteristics, recovers cross-sectional and time-varying stylized facts of financial constraints, and is applicable to both public and private firms.
- JEL Code
- E44 : Macroeconomics and Monetary Economics→Money and Interest Rates→Financial Markets and the Macroeconomy
G00 : Financial Economics→General→General
G30 : Financial Economics→Corporate Finance and Governance→General
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
- 12 June 2020
- WORKING PAPER SERIES - No. 2419Details
- Abstract
- This paper aims at investigating the relationship between firms’ profit efficiency, access to finance and innovation activities. We enrich our understanding on firms’ performance by adopting the stochastic frontier approach (SFA), which allows us to estimate profit functions and to obtain efficiency scores for a large sample of European firms. We pioneer the use of a novel dataset that merges survey-based data derived from the ECB Survey on access to finance for enterprises (SAFE) with balance sheet information. Our evidence documents that credit constrained firms display an incentive to improve their efficiency in order to increase profitability. Among firms that have embarked in product innovation, those in the industry and high-tech sectors see their effort translated in higher profit efficiency. From a policy perspective, our results could help to better understand the link between innovation, financial constraints and efficiency, which goes beyond the idea that easier access to finance is the panacea to get higher profit efficiency.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
D24 : Microeconomics→Production and Organizations→Production, Cost, Capital, Capital, Total Factor, and Multifactor Productivity, Capacity
L23 : Industrial Organization→Firm Objectives, Organization, and Behavior→Organization of Production
O31 : Economic Development, Technological Change, and Growth→Technological Change, Research and Development, Intellectual Property Rights→Innovation and Invention: Processes and Incentives
C33 : Mathematical and Quantitative Methods→Multiple or Simultaneous Equation Models, Multiple Variables→Panel Data Models, Spatio-temporal Models
- 7 April 2020
- WORKING PAPER SERIES - No. 2390Details
- Abstract
- This paper provides new evidence on the channels of monetary policy transmission combining 9 million observations on firm level investment and high-frequency identified monetary policy shocks. We show that the reaction of firms’ investment to a monetary policy shock is heterogeneous along dimensions that correspond to the two main channels of monetary policy transmission. First, we show that young firms are more sensitive to monetary policy shocks, supporting the existence of a credit channel of monetary policy. Second, we document large cross-sectional heterogeneity related to the industry the firm operates in. We find that firms producing durable goods react more than others, which is consistent with traditional interest rate channel effects of monetary policy. Third, we find that the effect of monetary policy shocks is longer lived for firms that are durable goods producers than for young firms indicating that demand effects last longer than credit effects.
- JEL Code
- E22 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Capital, Investment, Capacity
E52 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Monetary Policy
- 27 December 2019
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 8, 2019Details
- Abstract
- This box reports the responses to an ad hoc question in the latest Survey on the Access to Finance of Enterprises (SAFE) regarding the export activities of euro area small and medium-sized enterprises (SMEs). In general, just over a third of euro area SMEs exported goods or services outside their domestic market. About half of those exported outside Europe, of which 60% to North America and 40% to China. Comparing sectors, export activities seem to be quite strong among SMEs in the industrial sector, followed by trade and services, but more limited in construction. Exporters, particularly those exporting outside Europe, tend to have a strong equity base and use trade credit. They also make more use of subsidised loans and tend to be more innovative.
- JEL Code
- E24 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Employment, Unemployment, Wages, Intergenerational Income Distribution, Aggregate Human Capital
- 16 December 2019
- WORKING PAPER SERIES - No. 2341Details
- Abstract
- Using a large set of firm-level survey data from the euro area since 2009, we analyse how firms use their information to form expectations on the availability of bank finance. Our results suggest that firms update what otherwise look like adaptive expectations on the basis of the latest information in their information set. As in the previous literature, the hypothesis that expectations fulfil the (orthogonality) conditions of the rational expectations hypothesis is rejected by the data. We find evidence that this is not only due to information imperfections but also to some type of misspecification of the expectations’ model that firms are using. In addition, we find some evidence that companies that have not used bank finance recently tend to do worse at forecasting its availability next period. To test how policy announcements may affect expectations, we concentrate on the possible effects of the ECB policy announcements of summer 2012, which included among other things the announcement of the European Central Bank’s Outright Monetary Transactions Program (OMT). Using a difference-in-differences approach, we find evidence of forward-looking expectations. In particular, shortly after the OMT announcement the forecast of “informed” firms were more upbeat compared to the control group of firms. This moreover was true in both vulnerable and non-vulnerable countries, suggesting that it was the relevance of the information about the future of the banking system that most mattered for expectations at the time, more than the immediate impact of the announced policy measures.
- JEL Code
- C83 : Mathematical and Quantitative Methods→Data Collection and Data Estimation Methodology, Computer Programs→Survey Methods, Sampling Methods
D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
D84 : Microeconomics→Information, Knowledge, and Uncertainty→Expectations, Speculations
- 17 May 2017
- WORKING PAPER SERIES - No. 2063Details
- Abstract
- We investigate the impact of employment protection on firms credit access by looking at both credit obtained from banks and firms’ decision to apply for a loan. We find that greater flexibility in structuring the employees’ working hours and in dismissing employees increases the probability that firms obtain credit and that greater flexibility in dismissing employees decreases the probability that firms are discouraged from applying for credit. However, our findings also reveal that firms perceive regulations providing flexibility with regard to the employees’ working hours differently from banks, leading to a situation in which firms are more likely to be discouraged from applying for a loan, even though the probability to obtain a loan increases. Our results are robust to confounding, endogeneity, selection bias as well as to alternative specifications.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
J41 : Labor and Demographic Economics→Particular Labor Markets→Labor Contracts
- 28 January 2016
- OCCASIONAL PAPER SERIES - No. 167Details
- Abstract
- Although monetary union created the conditions for improving economic and financial integration in the euro area, in the context of the financial and sovereign crises, it has also been accompanied by the emergence of severe imbalances in savings and investment, credit and housing booms in some countries and the allocation of resources towards less productive sectors. The global financial crisis and the euro area sovereign debt crisis then led to major and abrupt adjustments as the risks posed by the large imbalances materialised. Although the institutional shortcomings in the EU that permitted the emergence of imbalances have been largely addressed since 2008, the adjustment process is not yet complete. From a macroeconomic perspective, the imbalances in the external accounts have led to the accumulation of high levels of external liabilities that need to be reduced, which, in turn, is weakening investment and therefore weighing on growth prospects and growth potential. From a macroprudential perspective, the lingering imbalances have added to systemic risk and rendered the euro area more vulnerable to risks. This Occasional Paper analyses the dynamic patterns in macroeconomic imbalances primarily from the former perspective, addressing in particular the connections between macroeconomic and sectoral adjustments of imbalances and the challenges for economic growth and performance over a longer horizon.
- JEL Code
- E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E22 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Capital, Investment, Capacity
F32 : International Economics→International Finance→Current Account Adjustment, Short-Term Capital Movements
F41 : International Economics→Macroeconomic Aspects of International Trade and Finance→Open Economy Macroeconomics
- 24 August 2015
- WORKING PAPER SERIES - No. 1842Details
- Abstract
- This paper uses a new survey-based data set and a model with strong theoretical under-pinnings to explain the characteristics and behaviour of discouraged borrowers in the euro area. The results show that more borrowers are discouraged when the average interest rate charged by banks in a country is higher. Higher corporate tax rates, on the other hand, lead to lower discouragement. We show that discouragement has strong negative effects on in- vestment growth (-4.7pp), employment growth (-2.7pp) and asset growth (-2.9pp) due to the lack of access to bank finance in the two years following the discouragement. Furthermore, we estimate that the majority of discouraged borrowers would be unable to get a loan if they would apply. Consistent with this low loan approval likelihood, discouraged borrowers tend to be relatively risky firms.
- JEL Code
- G01 : Financial Economics→General→Financial Crises
G10 : Financial Economics→General Financial Markets→General
G30 : Financial Economics→Corporate Finance and Governance→General
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
- 6 August 2015
- WORKING PAPER SERIES - No. 1836Assessing the financial and financing conditions of firms in Europe: the financial module in CompNetDetails
- Abstract
- This paper provides an encompassing description of the various indicators compiled in the financial module of CompNet using balance sheet information of European firms. We investigate whether and to which extent the heterogeneous financial positions of firms have affected firms
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
D24 : Microeconomics→Production and Organizations→Production, Cost, Capital, Capital, Total Factor, and Multifactor Productivity, Capacity
D92 : Microeconomics→Intertemporal Choice→Intertemporal Firm Choice, Investment, Capacity, and Financing
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
- 13 July 2015
- WORKING PAPER SERIES - No. 1829Details
- Abstract
- We investigate the role of the judicial system on whether or not the firms obtain the credit they applied for, by looking at the strength of the creditor protection, the strength of property rights, the time for resolving a dispute, its costs and the number of procedures the plaintiff faces. We use data about 48,590 firms from eleven countries collected via the Survey on the Access to Finance of Enterprises (European Central Bank) and data from the World Bank, the Heritage Foundation and Eurostat. The results suggest that the better the judicial enforcement system is (reduced costs, reduced time, and limited number of procedures) and the higher the creditor protection is (high overall strength of the legal system, high property rights protection), the lower the probability that the firms are credit constrained. Our results are robust to selection bias (Heckman selection) as well as different controls and different estimation techniques. More importantly, we find that these variables have considerable economic impact: the probability to obtain credit is up to 40% higher in countries with a better legal system.
- JEL Code
- G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
G28 : Financial Economics→Financial Institutions and Services→Government Policy and Regulation
K41 : Law and Economics→Legal Procedure, the Legal System, and Illegal Behavior→Litigation Process
- 7 July 2015
- WORKING PAPER SERIES - No. 1823Details
- Abstract
- In this paper we consider the relation between firms
- JEL Code
- D24 : Microeconomics→Production and Organizations→Production, Cost, Capital, Capital, Total Factor, and Multifactor Productivity, Capacity
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
O16 : Economic Development, Technological Change, and Growth→Economic Development→Financial Markets, Saving and Capital Investment, Corporate Finance and Governance
- 26 June 2015
- WORKING PAPER SERIES - No. 1820Details
- Abstract
- We investigate the effect of sovereign stress and of unconventional monetary policy on small firms
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
E58 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Central Banks and Their Policies
G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
H63 : Public Economics→National Budget, Deficit, and Debt→Debt, Debt Management, Sovereign Debt
- 29 January 2014
- WORKING PAPER SERIES - No. 1630Details
- Abstract
- We use a large database of more than 685,000 European firms to show that financial flexibility attained through conservative leverage policies is more important for private, small, medium-sized and young firms and for firms in countries with lower access to credit and weaker investor protection. Further, using the recent financial crisis as a natural experiment, we show that financial flexibility status allows companies to reduce the negative impact of liquidity shocks on their investment decisions. Our findings support the hypothesis that financial flexibility relates to companies
- JEL Code
- G31 : Financial Economics→Corporate Finance and Governance→Capital Budgeting, Fixed Investment and Inventory Studies, Capacity
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
D92 : Microeconomics→Intertemporal Choice→Intertemporal Firm Choice, Investment, Capacity, and Financing
- 15 August 2013
- WORKING PAPER SERIES - No. 1577Details
- Abstract
- This paper uses a non-parametric matching procedure to match survey replies to balance sheet information. It draws on the SAFE survey on access to finance for a sample of 11886 firms in the euro area which are matched with their nearest neighbour in an extended data-set with balance sheet information on 2.3 million firms. We investigate the role of firm characteristics with respect to the experience of facing financing obstacles in the period 2009-2011. We distinguish between firms' perceived financing constraints and actual financing constraints. We find that more pro table firms are less likely to face actual financing constraints. Also firms with more working capital and lower leverage ratios are less likely to be actually financially constrained, however profitability measures seem to be more robust. Firms are more likely to perceive access to finance problematic when they have more debt with short term maturity. Finally, firm age, but not size, is important in explaining both the perceived and the actual financial constraints.
- JEL Code
- E22 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Capital, Investment, Capacity
G30 : Financial Economics→Corporate Finance and Governance→General
G10 : Financial Economics→General Financial Markets→General
O16 : Economic Development, Technological Change, and Growth→Economic Development→Financial Markets, Saving and Capital Investment, Corporate Finance and Governance
K40 : Law and Economics→Legal Procedure, the Legal System, and Illegal Behavior→General
- 8 August 2013
- OCCASIONAL PAPER SERIES - No. 151Details
- Abstract
- This report analyses and reviews the corporate finance structure of non-financial corporations (NFCs) in the euro area, including how they interact with the macroeconomic environment. Special emphasis is placed on the crisis that began in 2007-08, thus underlining the relevance of financing and credit conditions to investment and economic activity in turbulent times. When approaching such a broad topic, a number of key questions arise. How did the corporate sector
- JEL Code
- E0 : Macroeconomics and Monetary Economics→General
E5 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit
- 13 December 2012
- WORKING PAPER SERIES - No. 1502Details
- Abstract
- While many theories of accounts payable and receivable are related to firm performance, there has not been a direct test whether firms actively use them to manage their growth. We argue that it is not just the accounts payable but also the accounts receivable that matter. While the former help to alleviate imperfections in the financial market, the latter do so in the product market. Using over 2.5 million observations for 600.000 firms in 8 euro area countries in the period 1993-2009, we show that firms use the trade credit channel to manage growth. In countries where the trade credit channel is more present, the marginal impact is lower, but the total impact is still bigger. Further, firms that are more vulnerable to financial market imperfections, and therefore more likely to be financially constrained, rely more on the trade credit channel to manage growth. Finally, we show that also the overall conditions of the financial market matter for the importance of the trade credit channel for growth.
- JEL Code
- C23 : Mathematical and Quantitative Methods→Single Equation Models, Single Variables→Panel Data Models, Spatio-temporal Models
E44 : Macroeconomics and Monetary Economics→Money and Interest Rates→Financial Markets and the Macroeconomy
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
L25 : Industrial Organization→Firm Objectives, Organization, and Behavior→Firm Performance: Size, Diversification, and Scope
- 10 February 2011
- WORKING PAPER SERIES - No. 1293Details
- Abstract
- In this study we investigate the determinants of financing obstacles using survey data on a sample of around 5000 firms from the euro area countries. This completely new survey – started at the end of 2009 - gives us the opportunity to test whether firm characteristics such as size, age, economic branch, financial autonomy and ownership are valid predictors of financing obstacles also during the recent financial crisis. Our results show that only age and ownership are robust explanatory variables for firms’ perceived financing obstacles while mixed results are found for size and economic branches.
- JEL Code
- E22 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Capital, Investment, Capacity
G30 : Financial Economics→Corporate Finance and Governance→General
G10 : Financial Economics→General Financial Markets→General
O16 : Economic Development, Technological Change, and Growth→Economic Development→Financial Markets, Saving and Capital Investment, Corporate Finance and Governance
K40 : Law and Economics→Legal Procedure, the Legal System, and Illegal Behavior→General
- 23 September 2009
- WORKING PAPER SERIES - No. 1093Details
- Abstract
- Based on a rich database of government bond spreads and macroeconomic indicators over the period 2001-2008, we propose an empirical assessment of the role of fundamentals in driving long-term sovereign bond spreads of the new EU countries (Bulgaria, Czech Republic, Latvia, Lithuania, Hungary, Poland, Romania and Slovakia). The results of a dynamic panel error correction model that accounts for both common long-run determinants and cross-country heterogeneities in sovereign bond spreads tend to suggest that fundamentals still matter for market’s assessment of a country creditworthiness. Countries’ levels of external debt, fiscal and current account balances, exchange and inflation rates, their degree of trade openness as well as short-term interest rate spreads play an important role in the new EU countries’ access to long-term finance. We furthermore challenge the pooled mean approach in order to check whether other factors may become relevant in the long-run for two sub-groups of countries according to the developments in their current account balances. Fiscal fundamentals seem to matter most for one group of countries, those characterised by widening external imbalances and historically high levels of spreads. In a context of heightened risk aversion and potential for spill over effects, this group of countries are more exposed to domestic sources of vulnerability as well as to swings in market perceptions of sovereign risks.
- JEL Code
- G12 : Financial Economics→General Financial Markets→Asset Pricing, Trading Volume, Bond Interest Rates
H60 : Public Economics→National Budget, Deficit, and Debt→General
E62 : Macroeconomics and Monetary Economics→Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook→Fiscal Policy
- 27 January 2009
- WORKING PAPER SERIES - No. 997Details
- Abstract
- This paper investigates whether financial obstacles, and, more generally, financial pressure faced by firms, significantly affect firm growth. For this purpose, we use an unbalanced panel of about 1,000,000 observations for around 155,000 non-financial corporations in five euro area countries. In addition to the balance sheet information in this panel, we also rely on firm-level survey data. In this way we are able to work out a direct measure of the firms' probability of facing financing obstacles. Our results indicate that, though based on few variables, this measure appears to be relevant in explaining firm growth in four out of the five countries considered. Other firm-level variables related to the financial pressure faced by firms, such as cash flow (debt burden) are found to exert a positive (negative) impact on firm growth, while the results for leverage are less clear-cut.
- JEL Code
- C23 : Mathematical and Quantitative Methods→Single Equation Models, Single Variables→Panel Data Models, Spatio-temporal Models
E22 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Capital, Investment, Capacity
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
L11 : Industrial Organization→Market Structure, Firm Strategy, and Market Performance→Production, Pricing, and Market Structure, Size Distribution of Firms
L25 : Industrial Organization→Firm Objectives, Organization, and Behavior→Firm Performance: Size, Diversification, and Scope
- 22 September 2008
- WORKING PAPER SERIES - No. 943Details
- Abstract
- This paper analyses the impact that firms financial position has on investment decisions using panel data from a large sample of non-financial corporations(around 120,000 firms) in six euro area countries(Belgium, Germany, France, Italy, the Netherlands and Spain). The results indicate that financial position is important to explain capital expenditures, as financial pressure appears relevant in explaining investment dynamics when it is proxied by cash flow, indebtedness and debt burden. The results also show differences in the sensitivity of investment rates to changes in financial pressure across countries, which appears to be especially large in the Netherlands and Italy and relatively small in Germany.
- JEL Code
- C33 : Mathematical and Quantitative Methods→Multiple or Simultaneous Equation Models, Multiple Variables→Panel Data Models, Spatio-temporal Models
E22 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Capital, Investment, Capacity
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
J23 : Labor and Demographic Economics→Demand and Supply of Labor→Labor Demand
- 28 June 2007
- OCCASIONAL PAPER SERIES - No. 63Details
- Abstract
- This report analyses the financial position of non-financial enterprises in the euro area, in particular the amount of external financing, the choice between debt and equity and the composition and maturity structure of debt. It aims at identifying the main features of the euro area, as well as the peculiarities that depend on the country of origin and the sector of activity. Attention is also devoted to assessing whether a country's institutional features are correlated with different financial structures by firms. In light of the particular interest in the access of small and medium-sized enterprises (SMEs) to financing, the report also analyses how financing patterns differ across large, medium-sized and small enterprises. Finally, the report discusses the recent trends observed in the corporate finance landscape of the euro area over the past few years. Although it is still too early to pass final judgement, vast structural changes are underway that could have already influenced in a positive way in the availability of external funds for firms. All in all, a comprehensive understanding of corporate finance in the euro area is important from a monetary policy perspective, given its impact on the transmission mechanism and for productivity and economic growth. Moreover, such an understanding is also relevant from a financial stability perspective. A first assessment is now possible eight years into the third stage of Economic and Monetary Union (EMU), given that sufficient data have been accumulated during this period. This assessment is particularly important as the introduction of the single currency has had significant structural effects on the working of financial markets, increasing their size and liquidity, and fostering cross-border competition. The data available for this report generally cover the period 1995-2005, and the cut-off date for the statistics included is 10 March 2007.
- JEL Code
- D92 : Microeconomics→Intertemporal Choice→Intertemporal Firm Choice, Investment, Capacity, and Financing
G30 : Financial Economics→Corporate Finance and Governance→General
G10 : Financial Economics→General Financial Markets→General
O16 : Economic Development, Technological Change, and Growth→Economic Development→Financial Markets, Saving and Capital Investment, Corporate Finance and Governance
K40 : Law and Economics→Legal Procedure, the Legal System, and Illegal Behavior→General
- 26 June 2006
- WORKING PAPER SERIES - No. 642Details
- Abstract
- This paper investigates the financing conditions of non-financial corporations in the euro area. We develop a new firm classification based on micro data by distinguishing between three groups of firms: unconstrained, relatively and absolutely constrained firms. We also provide further evidence on the sources of the correlation between corporate cash flow and cash savings by conducting the analysis in a dynamic framework. Contrary to previous evidence based mainly on US firms, our results suggest that the propensity to save cash out of cash flows is significantly positive regardless of firms' financing conditions. This implies that even for firms with favourable external financing conditions, the internal cash flow is used in a systematic pattern for the inter-temporal allocation of capital. The results also indicate that the cash flow sensitivity of cash holdings cannot be used for testing financing constraints of euro area firms.
- JEL Code
- D92 : Microeconomics→Intertemporal Choice→Intertemporal Firm Choice, Investment, Capacity, and Financing
G3 : Financial Economics→Corporate Finance and Governance
G32 : Financial Economics→Corporate Finance and Governance→Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill
- 11 February 2005
- OCCASIONAL PAPER SERIES - No. 23Details
- Abstract
- This occasional paper explains why the bank lending survey was developed by the ECB and describes its main features. It discusses the importance of credit developments for both the economy and the functioning of monetary policy, and further clarifies why the survey was introduced. Furthermore, the paper demonstrates that the value added of implementing a bank lending survey for the euro area lies in particular in the way it provides greater insight into developments in credit standards, non-interest rate credit conditions and terms, the risk perception of banks and the willingness of banks to lend. Credit standards are the internal guidelines or criteria of a bank which reflect the bank
- JEL Code
- E43 : Macroeconomics and Monetary Economics→Money and Interest Rates→Interest Rates: Determination, Term Structure, and Effects
E51 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Money Supply, Credit, Money Multipliers
G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
- 5 May 2004
- OCCASIONAL PAPER SERIES - No. 14Details
- Abstract
- In this paper, we present a set of specific measures to quantify the state and evolution of financial integration in the euro area. Five key markets are considered, namely the money, corporate bond, government bond, credit and equity markets. Building upon the law of one price, we developed two types of indicators that can be broadly categorised as price-based and news-based measures. We complemented these measures by a number of quantity-based indicators, mainly related to the evolution of the home bias. Results indicate that the unsecured money market is fully integrated, while integration is reasonably high in the government and corporate bond market, as well as in the equity markets. The credit market is among the least integrated, especially in the short-term segment.
- JEL Code
- G12 : Financial Economics→General Financial Markets→Asset Pricing, Trading Volume, Bond Interest Rates
G14 : Financial Economics→General Financial Markets→Information and Market Efficiency, Event Studies, Insider Trading
G15 : Financial Economics→General Financial Markets→International Financial Markets
G18 : Financial Economics→General Financial Markets→Government Policy and Regulation
- 2022
- European Economic ReviewUnconventional Monetary Policy, Funding Expectations, and Firm Decisions
- 2022
- European Economic Review
- 2022
- Eurasian Business ReviewDo innovation and financial constraints affect the profit efficiency of European enterprises?
- 2022
- Journal of Business Research
- 2022
- Journal of Corporate Finance
- 2020
- Review of Behavioral Finance
- 2020
- Journal of Corporate Finance
- 2019
- Intereconomics
- 2019
- Small Business Economics
- 2019
- EIB working paper 2019/03
- 2018
- EIB Working Paper Series 2018/4Investment of financially distressed firms: the role of trade credit
- 2018
- EIB Working Paper series, 2018/7Young SMEs: Driving innovation in Europe?
- 2018
- EIB Working Paper series, 2018/2
- 2018
- International Journal of Finance and Economics
- 2018
- Economia Politica
- 2018
- Journal of Money, Credit and Banking
- 2018
- Chapter 13 in “Finance and Investment: The European Case, edited by C. Mayer, S. Micossi, M. Onado, M. Pagano and A. Polo. Oxford: Oxford University Press, 2018The Capital Markets Union and firms’ access to external market-based finance: Evidence and policy implications from a novel survey-based index
- 2017
- European Investment Bank, 2017
- 2017
- Journal of Banking and Finance, vol. 81, August 2017, pp. 65-80
- 2017
- CEPR DP 12006, 2017
- 2017
- Chapter 1, pp. 3-28 in “Access to Bank Credit and SME Financing” edited by S. Rossi, Palgrave Publisher, 2017
- 2017
- Chapter 2. pp. 29-58 in “Access to Bank Credit and SME Financing” edited by S. Rossi, Palgrave Publisher, 2017
- 2017
- European Financial Management, vol. 23, issue 1, pp. 87-126, January 2017
- 2016
- European Journal of Finance, 9 September 2016
- 2015
- The Economic and Social Review, vol. 46, No1, pp.87-118Financial obstacles and financial conditions of firms: do perceptions match the actual conditions
- 2015
- BIS IFC Bulletin, forthcomingFirms’ financial statements and competitiveness: an analysis for European non-financial corporations using micro-based data
- 2015
- PME Rapport sur l’evolution des PME, Observatoire des PME, bpiFrance, pp. 139-144.
- 2015
- Chapter 6 in “Public Private Partnerships for infrastructure and enterprise funding. Principles, Practices and Perspectives”. Edited by S. Caselli, G. Corbetta and V. Vecchi, Palgrave Publisher,SMEs access to credit: are government measures helpful for constrained firms?
- 2014
- European Journal of Law and EconomicsMultiple Market Imperfections, Firm profitability and investment
- 2014
- Economic ModellingDoes Employment Protection Legislation Affect Firm Investment? The European Case
- 2013
- Journal of Banking and Finance 37 (2013), pp. 3035-3046Do firms use the Credit Channel of Trade to finance growth?
- 2013
- BIS IFC Bulletin n. 36, FebruaryMeasuring the opinion of firms on the supply and demand of external financing in the euro area
- 2012
- Small Businesses in the Aftermath of the Crisis, eds G. Calcagnini and I. Favaretto, eds, Springer VerlagAccess to finance in the euro area: what are SMEs telling us about the crisis?
- 2011
- The European Journal of FinanceFinancing obstacles and growth: an analysis for euro area companies
- 2010
- Sovereign Debt: From Safety to Default , Robert Kolb editor, John Wiley & SonsSovereign bond spreads in Central and Eastern Europe
- 2010
- Journal of Eastern European Economics (EEE), vol. 48, n.5,Sep-Oct, pp. 5-37Determinants of government bond spreads in new EU countries
- 2010
- The European Journal of Finance, Vol. 16, No. 2, February 2010, 153–171Financing constraints and Firms’ cash policies in the euro area
- 2008
- Handbook of European Financial markets and Institutions, edited by X. Freixas, P. Hartmann and C. Mayer, Oxford University PressMeasuring European Financial Integration
- 2007
- n 6, Industrial Policy and Economic Reform papers, DG Enterprise and IndustryIs the growth of euro area small and medium-sized enterprises constrained by financing barriers?
- 2005
- Elements of the euro area: integrating financial markets, M. Grande, J. Berg and F. P. Mongelli (eds), Ashgate, AldershotConcepts and measures of financial integration
- 2005
- Elements of the euro area: integrating financial markets, M. Grande, J. Berg and F. P. Mongelli (eds), Ashgate, AldershotBond and Equity market integration
- 2004
- Oxford Review of Economic Policy, vol. 20, no 4, pp. 509-530Measuring the integration of euro area capital markets
- 2000
- Economic Notes, July, pp. 215-241The Italian banking structure in the nineties: testing the multimarket contact hypothesis
- 1999
- La questione dimensionale in Italia, F. Traù (ed.), Il Mulino, BolognaBusiness shock e dimensione d’impresa
- 1999
- DG Enterprise working paper n. 4Gross Fixed Capital Formation in Europe: 1970-1998
- 1998
- Atti del Convegno SIS97 La statistica delle imprese, vol. 2, Tirrenia Stampatori, TorinoErrori di misurazione del costo del capitale e redditività delle imprese: un’analisi panel di imprese italiane
- 1997
- Quaderni di Statistica e Matematica applicata alle Scienze Economico-Sociali, vol. XVIII, n.1-4, pp. 121-138Le determinanti dei tassi di interesse sui prestiti nei mercati locali
- 1997
- Nota di Lavoro 61.97, Fondazione ENI Enrico MatteiPyramidal Groups and external finance: an empirical investigation
- 1996
- Rivista Internazionale di Scienze Economiche e Commerciali, vol.XLIV, 1, MarchThe adoption of advanced technologies in the Italian industrial sectors: a map from the census data
- 1995
- Innocenzo Gasparini Institute (IGIER) Working paper n.86The cost of durable assets in structure-performance models
- 1994
- Quaderni di economia e finanza, anno III, n.1, pp. 107-139L’industria italiana all’inizio degli anni novanta: un’analisi su dati di bilancio
- 1994
- CSC Ricerche n.109Capitalisation and structure-performance models
- 1992
- Ricerche Economiche, n.3-4, Luglio-Dicembre , pp.221-242Patent policy and vertical product differentiation