Publication: Cash Constraints and Credit Corsets : The Chimera of Interenterprise Credit
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1995-03
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2012-08-13
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The buildup of interenterprise credit in many Central and Eastern European countries is often seen as a problem that requires a government bailout. The authors show that arrears rise only temporarily, as the hard budget constraint bites, and then plateau. Therefore, they argue that while governments should monitor the stock of debt to see how quickly enterprises are adjusting, they shouldn't be panicked into bailing them out.
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“Condon, Timothy; Ramachandran, S.. 1995. Cash Constraints and Credit Corsets : The Chimera of Interenterprise Credit. Viewpoint: Public Policy for the Private Sector; Note No. 41. © World Bank. http://hdl.handle.net/10986/11676 License: CC BY 3.0 IGO.”
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