Financing Labor

35 Pages Posted: 20 May 2015

See all articles by Efraim Benmelech

Efraim Benmelech

Northwestern University - Kellogg School of Management; National Bureau of Economic Research (NBER)

Nittai Bergman

Tel Aviv University; National Bureau of Economic Research (NBER)

Amit Seru

Stanford University

Multiple version iconThere are 2 versions of this paper

Date Written: May 19, 2015

Abstract

Financial market imperfections can have significant impact on employment decisions of firms. We illustrate the economic importance of this channel by showing that employment decisions are constrained by firms' financial health and liquidity. Our main analysis uses a collage of three 'quasi-experiments' to trace the effects of finance on employment. The results suggest that financial constraints and the availability of credit play an important role in firm-level employment decisions, as well as aggregate unemployment outcomes.

Keywords: Credit, Financial Constraints, Labor, Unemployment.

JEL Classification: G31, G33, J31, J64

Suggested Citation

Benmelech, Efraim and Bergman, Nittai and Seru, Amit, Financing Labor (May 19, 2015). Available at SSRN: https://ssrn.com/abstract=2608189 or http://dx.doi.org/10.2139/ssrn.2608189

Efraim Benmelech (Contact Author)

Northwestern University - Kellogg School of Management ( email )

Evanston, IL 60208
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Nittai Bergman

Tel Aviv University

Ramat Aviv
Tel-Aviv, 6997801
Israel

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Amit Seru

Stanford University ( email )

Stanford, CA 94305
United States

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