Do Bank-Firm Relationships Influence Firm Internationalization? (Bonis R., Ferri G., Rotondi Z.)

Bank-Borrower Relationships

Abstract We show that a longer relationship length with the main bank fosters Italian firms' foreign direct investment (FDI) and, weakly, production off-shoring abroad. Possibly, longer bank relationships help secure external financing for these companies, which have become more opaque because of their internationalization. In contrast, other than for smaller-sized companies, we detect no impact on firms' propensity to export, suggesting that exporting alters enterprises' financial set-up less than shifting production internationally. We also find a link between the internationalization of the main creditor bank and firm FDIs. Our evidence suggests that reexisting strong bank-firm relationships support manufacturing firms' production internationalization.
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Libref/ Bonis R., Ferri G., Rotondi Z. (2010) “Do Bank-Firm Relationships Influence Firm Internationalization?”, MoFiR Working Paper № 37, pp. 1-26
© Программирование — Александр Красильников, 2008
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