Financing firms in hibernation during the COVID-19 pandemic

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dc.contributor.authorDidier, Tatiana
dc.contributor.authorHuneeus, Federico
dc.contributor.authorLarrain, Mauricio
dc.contributor.authorSchmukler, Sergio L.
dc.date.accessioned2025-01-20T23:51:55Z
dc.date.available2025-01-20T23:51:55Z
dc.date.issued2021
dc.description.abstractThe coronavirus (COVID-19) pandemic halted economic activity worldwide, hurting firms and pushing many of them toward bankruptcy. This paper discusses four central issues that have emerged in the academic and policy debates related to firm financing during the downturn. First, the economic crisis triggered by the pandemic is radically different from past crises, with important consequences for optimal policy responses. Second, it is important to preserve firms' relationships with key stakeholders (e.g., workers, suppliers, customers, and creditors) to avoid inefficient bankruptcies and long-term detrimental economic effects. Third, firms can benefit from "hibernation," incurring the minimum bare expenses necessary to withstand the pandemic while using credit to remain alive until the crisis subdues. Fourth, the existing legal and regulatory infrastructure is ill-equipped to deal with an exogenous systemic shock like a pandemic. Financial sector policies can help channel credit to firms, but they are hard to implement and entail different trade-offs. (C) 2020 Published by Elsevier B.V.
dc.fuente.origenWOS
dc.identifier.doi10.1016/j.jfs.2020.100837
dc.identifier.eissn1878-0962
dc.identifier.issn1572-3089
dc.identifier.urihttps://doi.org/10.1016/j.jfs.2020.100837
dc.identifier.urihttps://repositorio.uc.cl/handle/11534/94872
dc.identifier.wosidWOS:000628025700013
dc.language.isoen
dc.revistaJournal of financial stability
dc.rightsacceso restringido
dc.subjectCash crush
dc.subjectCoronavirus
dc.subjectCredit risk
dc.subjectFinancial policies
dc.subjectFirm relationships
dc.subject.ods05 Gender Equality
dc.subject.ods01 No Poverty
dc.subject.ods09 Industry, Innovation and Infrastructure
dc.subject.odspa05 Igualdad de género
dc.subject.odspa01 Fin de la pobreza
dc.subject.odspa09 Industria, innovación e infraestructura
dc.titleFinancing firms in hibernation during the COVID-19 pandemic
dc.typeartículo
dc.volumen53
sipa.indexWOS
sipa.trazabilidadWOS;2025-01-12
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