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Customer financing, bargaining power and trade credit uptake

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  • Simona Mateut
  • Thanaset Chevapatrakul

Abstract

We employ a panel quantile regression technique to investigate different theories explaining trade credit taken by firms. Consistent with the financing theory, our results suggest that the substitution between trade credit and bank loans increases at higher quantiles and it is stronger for larger firms with better access to external finance. Firms with a high market share operating in less concentrated industries have higher account payables to assets ratios, supporting the customer bargaining power theory.

Suggested Citation

  • Simona Mateut & Thanaset Chevapatrakul, 2016. "Customer financing, bargaining power and trade credit uptake," Discussion Papers 2016/04, University of Nottingham, Centre for Finance, Credit and Macroeconomics (CFCM).
    • Handle: RePEc:not:notcfc:16/04
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    3. Van Tien Nguyen & Ngoc Thang Doan, 2023. "Open account, import decision and financial constraints: A cross‐country firm‐level study," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(4), pages 3918-3937, October.
    4. Sabina Scarpellini & José Ángel Gimeno & Pilar Portillo-Tarragona & Eva Llera-Sastresa, 2021. "Financial Resources for the Investments in Renewable Self-Consumption in a Circular Economy Framework," Sustainability, MDPI, vol. 13(12), pages 1-17, June.
    5. Yuming Zhang & Han Liu & Shuang Li & Chao Xing, 2023. "The Digital Transformation Effect in Trade Credit Uptake: The Buyer Perspective," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 59(7), pages 2056-2078, May.

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    More about this item

    Keywords

    trade credit; bargaining power; panel quantile regression;
    All these keywords.

    JEL classification:

    • G3 - Financial Economics - - Corporate Finance and Governance
    • C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables

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