IMF Working Papers

External Financing Dependence and Corporate Saving in ASEAN5

By Xin Li

October 30, 2020

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Format: Chicago

Xin Li. External Financing Dependence and Corporate Saving in ASEAN5, (USA: International Monetary Fund, 2020) accessed November 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Using firm-level data on ASEAN5, this paper studies the differential effects of macro-financial and structural factors on corporate saving behavior through the lens of external financing dependence. The finding suggests that non-financial corporations in ASEAN5 have been subject to binding financial constraints over the past two decades. Greater capital account openness or exchange rate depreciation reduces the average saving rate of industries with low dependence on external funds, while it increases the saving rate of industries with high dependence on external funds. The effects are greater for export-oriented industries. An improvement in banking sector competition, banks’ lending efficiency, or policy clarity is associated with lower saving rate of firms across the board.

Subject: Balance of payments, Capital flows, Commercial banks, Corporate sector, Currencies, Financial institutions, Financial markets, Financial sector development, Money, National accounts, Precautionary savings

Keywords: ASEAN countries, Capital account openness, Capital flows, Commercial banks, Corporate saving, Currencies, Exchange rate depreciation, Exchange rate depreciation., Export-orientation, External financing need, Financial constraint, Financial sector development, Firm's use, Global, High-tech company, Level analysis, Precautionary saving theory, Precautionary savings, Saving behavior, Saving rate, Tech firm, Use of external finance, WP

Publication Details

  • Pages:

    41

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2020/223

  • Stock No:

    WPIEA2020223

  • ISBN:

    9781513560175

  • ISSN:

    1018-5941

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