Sant Anna, Andre A and ambrozio, antonio and De Sousa, Felipe Lage and Faleiros, Joao Paulo, Credit Scarcity in Developing Countries: An Empirical Investigation Using Brazilian Firm-Level Data (November 2014). Centro Studi Luca d’Agliano Development Studies Working Paper No. 372. Available at SSRN: http://ssrn.com/abstract=2567328

“The aim of this paper is investigating whether Brazilian industrial firms are credit constraint. We exploit a rich database that contains more than 3.000 firms with characteristics that may affect their degree of credit constraints: size, being listed in the Brazilian stock market and level of exports-sales ratio. Our results show that all dimensions considered here may affect the sensitiveness of investment to cash flow, i.e., large firms, stock market listed companies as well as large export capacity are associated with inexistence or less credit restriction. Specifically, considering firm’s size, our results corroborate the economic theory prediction and empirical international literature. However, when compared to Brazilian studies, our findings are similar to Terra (2003), however, they differ from Aldrighi and Bisinha (2010) evidences that are based only on listed firms. Furthermore, the influence of being listed in the stock market and export capacity is beyond any possible correlation with size. Even small and middle firms are not credit constraint when listed in the stock market or when the exports-sales ratio is higher.”