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Foreign currency borrowing, exports and firm performance: evidence from a currency crisis

Bougheas, Spiros; Lim, Hosung; Mateut, Simona; Mizen, Paul; Yalcin, Cihan


Hosung Lim

Paul Mizen

Cihan Yalcin


This paper develops a simple signaling model of foreign currency borrowing that yields predictions about firm survival and performance during a currency crisis. Using a large panel of firm level data for South Korea we offer empirical support for many of the predictions of our model, while others support predictions that cannot be tested using our data. Our paper demonstrates that although firms that borrow in foreign currency are more likely to exit after the currency collapses, those that continue to produce perform better. Among them, the best performers are exporters whose foreign sales are more competitively priced under a devalued currency.


Bougheas, S., Lim, H., Mateut, S., Mizen, P., & Yalcin, C. (2018). Foreign currency borrowing, exports and firm performance: evidence from a currency crisis. European Journal of Finance, 24(17), 1649-1671.

Journal Article Type Article
Acceptance Date Dec 20, 2017
Online Publication Date Jan 11, 2018
Publication Date Nov 22, 2018
Deposit Date Dec 21, 2017
Publicly Available Date Jul 12, 2019
Journal European Journal of Finance
Print ISSN 1351-847X
Electronic ISSN 1466-4364
Publisher Routledge
Peer Reviewed Peer Reviewed
Volume 24
Issue 17
Pages 1649-1671
Keywords Currency crisis; Exports; Foreign currency borrowing
Public URL
Publisher URL
Additional Information This is an Accepted Manuscript of an article published by Taylor & Francis in European Journal of Finance on 11 January 2018, available online:


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