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The losers from credit crunches

Berton, Fabio , Mocetti, Sauro , Presbitero, Andrea , Richiardi, Matteo , (2017), “The losers from credit crunches”, VoxEu, 9 February

In the aftermath of the Global Crisis, a severe credit crunch has had long-lasting consequences for a number of economies. Trade has collapsed (Paravisini et al 2011), investment expenditure has shrunk significantly (Cingano et al. 2016), and unemployment rates have increased markedly (e.g. Clements et al. 2012). These developments have triggered a renewed interest in the real effects of financial shocks and, in particular, on the effects that credit supply shocks have on firms’ employment decisions (Bentolila and Jansen 2014, Popov and Rocholl 2017).

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