Introduction

Abstract

Not only, but especially in times of financial or economic crises firms have to cope with external shocks. During the economic crises started in 2009 many firms were faced with two kinds of external shocks. First, caused by the financial crises many banks reduce their credit provision. This led to credit constraints especially for small and medium sized firms. Second, caused by the economic crises many firms were confronted with a drop in product demand. During the crises trade credit and temporary employment played a major role in firms’ adjustment strategies to cope with those kinds of shocks. Large firms with an easier access to external finance provide trade credit to their smaller business partners. By doing so they helped their smaller business partners to cope with the liquidity shock. Temporary employment was used to adjust the labor force on the reduced product demand during the crisis.