Auteur :
Betz
Frank,
Ravasan
Farshad R.
Année de Publication :
2016
Type : Rapport
Thème : Travail et Emploi
The economies in the Middle East and North Africa have not been able to generate a sufficient number of jobs for a fast growing population. This paper uses data from the MENA Enterprise Survey to investigate the extent to which the prevailing collateral practices affect the allocation of credit and firms’ ability to expand and create jobs. In a first step we use matched bank-firm data to recover banks’ collateral policies. Exploiting data on the location of firms and bank branches we then aggregate the estimated collateral policies into branch-weighted indices that represent collateral practices at the local level. We find that less stringent collateral regimes are conducive to employment growth.
Young firms in particular benefit from lower collateral ratios, while a greater willingness to accept movables benefits both young and old firms.