Do Firms with Weaker Balance Sheets Pay Higher Interest Rates? Panel Data Evidence from Czech Firms, 1996-2002.
|Author:||Mgr. Eva Horváthová|
|Year:||2004 - summer|
|Leaders:|| Ing. Irena Jindřichovská CSc.
|Work type:|| Finance and Banking
|Awards and prizes:||M.A. with distinction from the Dean of the Faculty of Social Sciences for an extraordinarily good masters diploma thesis|
|Abstract:||In the thesis, I empirically examine the financial accelerator model of Bernanke, Gertler and Gilchrist (1999) using large panel dataset of the financial statements of Czech firms. The most important findings are as follows. Individual interest rates are negatively related to the value of collateral and sales and positively associated with the net debt. Liquid assets, cash flows and cash and equivalents do not influence the cost of finance at the firm level. The effect of net debt on the interest rate is non-linear. Heterogeneity of individual interest rates increases dramatically during the recession.|