Abstract
The recent credit crisis led to a serious downturn in the United States and the rest of the world. This article analyzes the relationship between the crisis and financial development based upon European firm-level data. It studies how the level of financial development interacts with a firm’s dependence on external financing, as well as its size and age, in determining a firm’s earnings. It also tries to identify which factors explain the spread of shocks and their impacts on different firms during the crisis period. The results show that financial development is positively related to a firm’s earnings. Surprisingly, however, it can also exacerbate the impact of a crisis.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
