Trade credit and the joint effects of supplier and customer financial characteristics

Description

We examine how access to bank credit affects trade credit in the supplier-customer relationships of U.S. public firms. For identification, we use exogenous liquidity shocks to supplier firms in the form of staggered changes to interstate bank branching laws. Using a variety of tests, we show that supplier firms with greater access to banking liquidity offer more trade credit to their customers. We also show that when bank branching restrictions are relaxed in the supplier's state, the supplier-customer relationship is more likely to survive. (C) 2015 Elsevier Inc. All rights reserved.

Links & Downloads

1. Trade credit and the joint effects of supplier and customer financial characteristics 2017, 29:68 Journal of Financial Intermediation
2. 10429573
3. 10.1016/j.jfi.2015.09.001
4. http://hdl.handle.net/10150/623187
5. http://arizona.openrepository.com/arizona/handle/10150/623187
6. Journal of Financial Intermediation

Tags

Trade credit

Supplier-customer relationships

Bank lines of credit

Banking deregulation

Contagion

Financial distress

Additional Fields

Identifer	oai:union.ndltd.org:arizona.edu/oai:arizona.openrepository.com:10150/623187
Date	01 1900
Creators	Shenoy, Jaideep, Williams, Ryan
Contributors	Univ Arizona, Eller Coll Management
Publisher	ACADEMIC PRESS INC ELSEVIER SCIENCE
Source Sets	University of Arizona
Language	English
Detected Language	English
Type	Article
Rights	© 2015 Elsevier Inc. All rights reserved.
Relation	http://linkinghub.elsevier.com/retrieve/pii/S104295731500039X