Financing constraints, employment, and labor compensation: evidence from the subprime mortgage crisis

نویسنده

  • Jörg Rocholl
چکیده

This paper identifies the effect of financing constraints on firms’ labor demand. We exploit exogenous funding shocks to German savings banks during the US mortgage crisis that are unrelated to local conditions. We find that firms with credit relationships with affected banks experienced a significant decline in employment and in labor compensation relative to firms whose credit relationships were with healthy banks. We also find that the employment effect increases, and the wage effect decreases with firm size. The decline in employment at firms attached to affected banks appears to be more long-lasting than the decline in labor compensation. JEL classification: D92, G01, G21, J23, J31

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

منابع مشابه

Subprime Risk and Insurance with Regret

This paper investigates some of the risk and insurance issues related to the subprime mortgage crisis. The discussion takes place in a discrete-time framework with a subprime investing bank being considered to be regret and risk averse before and during the mortgage crisis, respectively. In particular, we investigate the bank’s investment choices related to risky subprime structured mortgage pr...

متن کامل

Bank corporate loan pricing following the subprime crisis

The massive losses that banks incurred with the meltdown of the subprime mortgage market have raised concerns about their ability to continue lending to corporations. We investigate these concerns. We find that firms paid higher loan spreads during the subprime crisis. Importantly, the increase in loan spreads was higher for firms that borrowed from banks that incurred larger losses. These resu...

متن کامل

Who has more influence on Asian stock markets around the subprime mortgage crisis – the US or China?

Who has more influence on Asian stock markets around the subprime mortgage crisis – the US or China? Chien-Chung Nieh , Chao-Hsiang Yang & Yu-Sheng Kao To cite this article: Chien-Chung Nieh , Chao-Hsiang Yang & Yu-Sheng Kao (2012) Who has more influence on Asian stock markets around the subprime mortgage crisis – the US or China?, Applied Economics Letters, 19:4, 329-335, DOI: 10.1080/13504851...

متن کامل

"CREAM-SKIMMING" IN SUBPRIME MORTGAGE SECURITIZATIONS: WHICH SUBPRIME MORTGAGE LOANS WERE SOLD BY DEPOSITORY INSTITUTIONS PRIOR TO THE CRISIS OF 2007? Paul Calem Federal Reserve Board of Governors

The views expressed in this paper are those of the authors and do not necessarily reflect the position of the Federal Reserve Board, the Federal Reserve Bank of Philadelphia, or Freddie Mac. We Abstract Depository institutions may use information advantages along dimensions not observed or considered by outside parties to " cream‐skim, " meaning to transfer risk to naïve, uninformed, or unconce...

متن کامل

The Role of Consumer Leverage in Financial Crises

Consumer leverage can contribute to nancial crises such as the subprime mortgage crisis characterized by increased bankruptcy prospects and tightened credit access. This paper embeds nancial frictions in the mortgage contracts of home-buyers within a two-sector economy to show that although households are not production agents and may not start as highly leveraged as nancial institutions, their...

متن کامل

ذخیره در منابع من


  با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

عنوان ژورنال:

دوره   شماره 

صفحات  -

تاریخ انتشار 2015