The Dangers of the Shift to a Disintermediated Model of Corporate Financing in the Euro Zone

Patrick Artus Chef économiste, Natixis, groupe BPCE ; professeur associé, Université Paris 1 Panthéon-Sorbonne. Contact :

Eurozone corporates already finance more on the capital markets and less through bank lending. This evolution is due to the new regulations of European banks, but also corresponds to a theoretical view according to which financing on the capital markets in more efficient. We believe that the switch of Eurozone corporates to financing on the capital markets is a mistake for two reason: the weakness of the demand of risky assets by individual investors; the requirement, with this type of financing, of a larger flexibility of the labor market.

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