Local financial development and the growth of small firms in Vietnam
2022 | journal article; research paper. A publication with affiliation to the University of Göttingen.
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- Authors
- Tran, Viet T.; Walle, Yabibal M.; Herwartz, Helmut ; Nguyen, Trung Thanh
- Abstract
- This paper examines whether heterogeneities in financial development among Vietnamese provinces matter for firm growth in Vietnam. Using a nationally representative firm survey that covers more than 41,000 firms for the period 2009 − 2013, we estimate the impact of provincial financial development on the growth rates of firms by accounting for sectoral differences in growth opportunities. We find that province-level financial development promotes the growth rates of sales, investment and sales per worker of small firms, and reduces the growth rate of the wage-to-sales ratio. Our results imply that firms grow faster in provinces with a higher level of financial development. Moreover, the effect of financial development on growth rates is larger when firms operate in sectors with better growth opportunities.
- Issue Date
- 2022
- Journal
- Journal of the Asia Pacific Economy
- Organization
- Wirtschaftswissenschaftliche Fakultät
- ISSN
- 1354-7860
- eISSN
- 1469-9648
- Language
- English
- Sponsor
- German Research Foundation 10.13039/501100001659