Using firm-level survey data combined with firm-level financial information, we investigate the effect of a subjective, firm-specific measure of uncertainty on firm investment and employment growth in the European Union. We find that uncertainty has an economically significant negative effect on...

A salient trend in crisis intervention has emerged in recent decades: Government and central banks offered funding directly to nonfinancial firms, bypassing banks and other credit intermediaries. We analyze the long-term consequences of such policies by focusing on firm quality dynamics. In a...

Over the past two decades, banks have increasingly focused on offering contingent credit in the form of credit lines as a primary means of corporate borrowing. We review the existing body of research regarding the rationales for banks' provision of liquidity insurance in the form of credit...