We study the relationship between net trade credit and firms' investment levels, focusing on financially distressed firms. First, we introduce a theoretical model to predict the role played by net trade credit as a coordination device differentiating firms by their degree of financial distress....

Since Fazzari et al. (1988), investment-cashflow sensitivity has been one of the most important indicators for testing and measuring the external financial constraints of corporations. This study analyzes the effect of changes in the relative cost of internal and external financing on investment...

We use a panel data set of European firms to analyse the effects of domestic and international M&As on target firms' investment, growth and financial constraints. Combining propensity score matching with a difference-in-differences estimator, our results indicate that upon acquisition, target...