Oaxaca-Blinder decomposition, COVID-19, Moldavian economy, Services sector, Cash commitments, Comparative analysis, Finance, HG1-9999, Business, HF5001-6182

Purpose – This study aims to use a comparative analysis to examine the channel of deferring cash commitments, which can be seen as a strategic solution to mitigate the impact of COVID-19 on Moldova's service sector. Design/methodology/approach – This paper uses the Oaxaca–Blinder decomposition analysis. The World Bank's post-COVID-19 survey is used. The methodology takes into account heterogeneity among firms. Findings – The results of the Oaxaca–Blinder decomposition analysis show that service firms use deferred cash commitments more than industrial firms, corporate governance and their pandemic-related strategies are also effective in the post-COVID Moldovan economy. The results are robust to different modeling alternatives. Originality/value – COVID-19 can be considered a key source of uncertainty for firms, especially those operating in economies where financial frictions occasionally occur in a transition economy. Therefore, this study can shed new light on the impact of COVID-19 on financial strategies in a transition economy.