Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/73451
Authors: 
Pflüger, Michael
Russek, Stephan
Year of Publication: 
2011
Series/Report no.: 
BGPE Discussion Paper 98
Abstract: 
The risk of default that business firms face is very significant and differs widely across countries. This paper explores the links between countries’ business conditions and international trade embedment and the default risk at the country level from a theoretical point of view. Our main contribution is to set up a general equilibrium model which allows us to derive sharp predictions concerning how key factors which shape a country’s business and trade environment impact on the default risk of firms which operate in these environments. The predictions are in accord with readily available data.
Subjects: 
firm death
firm heterogeneity
business conditions and firm productivity
trade integration
JEL: 
F12
F13
F15
L25
Document Type: 
Working Paper

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