Credit Constraints and Investment in Latin America

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CODE: B-606
EDITOR(s): Schiantarelli, Fabio
PUBLISHED: September 2003



What happens to firms in the face of financial crises? Little research has been done on the microeconomic implications of financial policies and crises while attention has been focused on the macroeconomic effects of these events. This book attempts to fill this research gap. Credit Constraints and Investment in Latin America contains new evidence on the nature, extent, evolution and consequences of financing constraints. It analyzes firms' investment behavior under conditions of severe market failure. The ability of the banking sector to pool resources and channel them efficiently to firms is an important determinant of the process of economic development and growth. The chapters in this volume use micro data to study credit supply restrictions at the firm level in Argentina, Colombia, Costa Rica, Ecuador, Mexico and Uruguay.

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