What else lies behind the credit rationing? Exploring the issue of employment

Purpose This paper aims to review the literature extensively by analysing recent work and providing a guide for models, data sets and research findings. Design/methodology/approach This paper reviews the literature extensively by analysing recent work and providing a guide for models, data sets and research findings within the context of capital market imperfections. The authors further break down the literature into closer-in-nature categories for reader’s convenience and comprehension. Finally, the authors address gaps in the existing literature and propose government policies that can tone down the potential effect of credit rationing on employment. Findings This paper provides a map of the literature so as to help future researchers in the relevant literature and give a short insight of what has been explored so far. Originality/value This paper is original and is the result of a thorough review of an extensive literature.