Credit Supply Shocks and Human Capital: Evidence from a Change in Accounting Norms

The Real Effects of Credit Supply: Review, Synthesis, and Future Directions

“…A large set of papers in the literature has sought to quantify the impact on the number of workers along with the heterogeneous effects across firms characteristics (e.g., Chodorow-Reich, 2013;Bentolila et al, 2017;Berton et al, 2018;Popov and Rocholl, 2018;Huber, 2018). Moreover, a growing body of the literature analyses the resulting changes in the composition of the labour force (e.g., Barbosa et al, 2019;Bentolila et al, 2017;Berton et al, 2018) as well as in wages (e.g., Hochfellner et al, 2015;Popov and Rocholl, 2018).…”

“…Hochfellner et al (2015) show that unskilled workers are more likely to lose their jobs and to experience wage cuts than their skilled counterparts do in times of crises. Distinct from the aforementioned studies analysing the effect of credit supply reductions during bad times, Barbosa et al (2019) exploit a negative shock to credit supply in non-crisis times, proxied by the changes in defined-benefit pension plans for Portuguese banks in 2005. They demonstrate that, for better opportunities in good times, skilled workers are more likely to leave and less likely to join constrained firms, suggesting that credit supply has important allocation effects on the labour composition.…”

“…The effect of credit supply on labour allocation: Another interesting and open question is how firms' responses to credit supply shocks affects wage inequality and thus the (in)efficient allocation of human capital. Existing evidence on labour allocation is scarce (e.g., Berton et al, 2018;Bai et al, 2018;Barbosa et al, 2019;Moser et al, 2018), and leaves plenty of room for additional investigations.…”

Employee Benefits Accounting, Its Impact on the Market Share Price, the Volume of Credit Facilities and Deposits

“…While the indirect compensation refers to all the cash and non-cash benefits and rewards provided to the employees by the institution where they work therein (Hoogendoorn, 2006), because they are members working therein, so providing to them is not connected to the performance and activity (Barbosa, Bilan, & Celerier, 2017). These incentives are called Employee benefits, which are a variety of services with a financial value services provided by organizations to all their employees as freely, or covering part of their cost (Frye, 2004), with no exceptions (for permanent employees only) and regardless of the level of their performance and efficiency at work, they are offered to them as their members working therein.…”

“…However, any study did not discuss the impact of spending on employees and its impact on enhancing the financial performance of the bank. This study examined the relationship between spending on employees in Jordanian commercial banks based on whatever other expenses were spent on the employees (medical, life insurance, travel, training and social security), at each market share price (where average of daily closing prices was adopted), and on the valume of credit facilities as well as the volume of deposits, which considered the main source of financing for the banking sector, on which they establsih tehir business (Barbosa, Bilan, & Celerier, 2017;Lode, & Napier, 2014;Dewi, 2015;Liapis, & Thalassinos, 2013). The results of this study, which attempts to measure the impact of employee benefits on both the average of market share price which is considered as a strength of the bank, as well as the volume of credit facilities granted to customers, which are considered the main source of income and the resultant interest and profits through granting credit facilities.…”