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As A Supply Chain Financing Source, Trade Credit and Bank Credit Relationship during Financial Crises from Clustering Point of View

Author

Listed:
  • Cuneyt Sevim
  • Aykut Ekiyor
  • Ali Tosyali

Abstract

This paper examines trade credit and bank credit behavior of firms during financial crisis using World Bank Survey dataset that contains detailed data on trade credit utilization of firms. Unlike literature, cluster analysis is used in order to investigate credit behavior of firms during financial crisis. For better clustering results, feature selection method is used to select variables thought to be important on model. When examined the trade and bank credit behavior of clusters that have been formed by using these variables with clustering analysis, it has been found that impact of the crisis on firms in the supply chain is important. It is found that due to demand fall for goods generated by crisis, firms are motivated to give trade credits to their customers in order not to lose them. However, firms need financial support either from the previous link in the supply chain through trade credit or from the financial institutions through bank credit.

Suggested Citation

  • Cuneyt Sevim & Aykut Ekiyor & Ali Tosyali, 2016. "As A Supply Chain Financing Source, Trade Credit and Bank Credit Relationship during Financial Crises from Clustering Point of View," International Business Research, Canadian Center of Science and Education, vol. 9(4), pages 45-57, April.
    • Handle: RePEc:ibn:ibrjnl:v:9:y:2016:i:4:p:45-57
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    References listed on IDEAS

    as
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    2. Chor, Davin & Manova, Kalina, 2012. "Off the cliff and back? Credit conditions and international trade during the global financial crisis," Journal of International Economics, Elsevier, vol. 87(1), pages 117-133.
    3. Nobuhiro Kiyotaki & John Moore, 2002. "Balance-Sheet Contagion," American Economic Review, American Economic Association, vol. 92(2), pages 46-50, May.
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    More about this item

    Keywords

    trade credit; bank credit; supply chain financing; financial crises;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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