Study of Who Supplies Funds for Trade Credit
Available Online May 2019.
- https://doi.org/10.2991/bems-19.2019.51How to use a DOI?
- trade finance; finance structure; pecking order.
- This study examined the relationship between trade credit and its financing structure using the financial statement data of Chinese listed firms from the year 2003-2018. I find that trade credit is positively related to external funds rather than internal funds. The amount of trade credit is significantly positive with equity, bank loans and credit received from suppliers. As for the effect of short-term loan and long-term loan on trade credit. short-term loan is positively related to trade credit, while long-term loan is negatively related to trade credit. Furthermore, stated-owned enterprise issue more trade credit as they have better access to the financial market. Big firms are likely to issue more trade credit, whereas fast growing firms would issue less trade credit.
- Open Access
- This is an open access article distributed under the CC BY-NC license.