Determinants of Financial Constraints: The Effect of Financial Crisis and Heterogeneity Across Industries

Based on the population of Slovenian firms we analyse the impact of the 2008 financial crisis on the firms' financial constraints. In line with the theoretical predictions firm size, ownership, productivity, and export orientation all impact firm's financial situation. With the full onset of the crisis in 2009, financial health of the foreign firms worsened more compared to domestic firms, while the availability of financial resources deteriorated less for more productive firms and for exporters. Even though firm's size has a significant impact on firm's financial constraint, crisis didn't have an additional significant negative effect on firms' financial distress for all but small firms.