Measuring Financial Restrictions of Brazilian Private Firms with Microdata: A Contract Theory Approach

Measuring Financial Restrictions of Brazilian Private Firms with Microdata: A Contract Theory Approach

• Autor
• FERNANDO NASCIMENTO DE OLIVEIRA
• Resumo

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  This study develops original measures of financial constraints for a sample of 6,215 private firms in Brazil spanning the period from 2012 to 2022. To construct these metrics, we utilize a granular dataset comprising 11,967,603 loan contracts between these firms and financial institutions, sourced from Banco Central do Brasil’s Credit Information System (SCR). Following the theoretical framework of Bester (1985), our identification strategy is based on relative interest rates and collateral requirements within the credit agreements. Using these constraints, we estimate the firms' investment demand and provide empirical evidence that financial frictions exert a statistically significant negative effect on capital expenditure. To provide a structural interpretation of our findings, we calibrate a continuous-time partial equilibrium dynamic stochastic model of investment. The simulation results demonstrate that financial restrictions adversely impact investment by reducing the total factor productivity of private firms.

   

• Palavras-chave
• financial restrictions measures, investment, private firms, loans, interest rates, collaterals, System of Credit Register, Banco Central do Brasil
• Modalidade
• Comunicação oral
• Área Temática
• Finanças Corporativas e Bancárias

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