Zombie firms drag down productivity in economy – BIS paper
Lower interest rates create conditions for “zombie firms”, researchers find
The share of zombie firms, those unable to cover debt servicing costs from profits, has increased from about 2% of firms in the 1980s to 12% in 2016, a team of researchers from the Bank for International Settlements finds.
Researchers Ryan Niladri Banerjee and Boris Hofmann use firm-level data on listed companies in 14 advanced economies during the period of 1980 to 2016 to investigate the trend and the consequences it has for the economy.
They find the share of zombie firms increases during
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