Publications

Publications in refereed journals



The signaling role of trade credit: evidence from a counterfactual analysis (with Gianfranco Atzeni and Luca Deidda)**. Journal of Corporate Finance, Vol. 80, June 2023, 102414. DOI. 


We quantify the signaling effect of trade credit on bank credit in a sample of US firms. Our identification strategy relies on the signaling model by Biais and Gollier (1997) and accounts for the endogeneity due to the possibility of self-selection and the simultaneity between banks’ and firms’ credit decisions. We find that(i) firms’ self-select into trade credit; (ii) firms’ decision to use trade credit results in a higher chance of obtaining bank credit and a lower cost than the counterfactual ones they would have faced if not using trade credit.

**Previous version circulating as "The signalling role of trade credit on loan contracts: evidence from a counterfactual analysis" (with Gianfranco Atzeni and Luca Deidda), CRENoS Working Paper 2021-06. 


Asset Exemption in Bankruptcy, Access to and Cost of Credit (with Gianfranco Atzeni and Luca Deidda, 2021)*. Forthcoming at Journal of Money Credit and Banking 

*Previous version circulating as "Asset Exemption in Entrepreneurs’ Bankruptcy and the Informative Role of Collateral". CRENoS Working Paper 2016-13. 


Under the US personal bankruptcy law, exempt assets are not liquidated following bankruptcy. Entrepreneurs can undo such a protection by posting collateral. We provide a complete characterization of the interplay between asset exemption from liquidation upon default and adverse selection in a competitive credit market. Severe adverse selection induces separation, with safer entrepreneurs choosing loan contracts characterized by high collateral requirements, lower cost of credit and credit rationing for wealth-constraints applicants. Irrespective of adverse selection, poor and safe entrepreneurs pool as they face too much rationing otherwise.  A higher exemption makes collateral more informative. Evidence from the SSBF survey supports our theory.


Policy reports (non-refereed)