Financial shocks, firm credit and the Great Recession

• 成果类型: Article
• 署名作者: Mehrotra, Neil; Sergeyev, Dmitriy
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - New York; Bocconi University
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2020.01.008
• 发表日期: 2021
• 关键词: Job flows; financial frictions; great recession

摘要

The creation and destruction margins of employment (job flows) can be used to measure the employment effects of disruptions to firm credit. Using a firm dynamics model, we establish that a tightening of credit to firms reduces employment primarily by reducing gross job creation, exhibiting stronger effects at new, young, and middle-sized firms. The firm credit channel accounts for, at most, 18%, of the decline in US employment in the Great Recession. Using MSA-level job flows data, we show that the job flows response to identified credit shocks is consistent with our model's predictions. (C) 2020 Elsevier B.V. All rights reserved.