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Imports, Employment and investment in Times of Financial Crisis and uncertainty

Banque de France - PARIS - 2016

We are studying the possibility that importers of intermediate goods lessen job losses when domestic credit contractions occur. We will argue that financial crisis are characterized by the recovery of economic activity which are not accompanied by job creation. This may be because of financial constraints. On the other hand, there is a possibility for a firm to obtain commercial credit from international trade partners, thus releasing part of the credit constraint.