The paper contributes to the literature on the economic advantages of urban agglomerations and examines whether Italian firms headquartered in an urban area have better access to credit. To this end, we devise an ease of access to credit indicator based on bank-firm data from the Central Credit Register.
Firms headquartered in urban areas have better access to credit compared with those located in non-urban areas only in the construction sector. This result is partially driven by the greater thickness of the real estate market in urban areas, leading to a higher liquidity of construction firms' output given as collateral. For manufacturing and service firms, no urban localization advantages are found.
Published in 2021 in: Journal of Regional Science, v. 61, 3, pp. 597-622.
