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Trade Credit Terms between the Firms in Bulgaria

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  • Galia Taseva

Abstract

In this article are presented the results of empirical sociological examination of trade credit terms in Bulgaria and are investigated the determinants of these terms. Based on the data obtained from the empirical sociological examination about the terms to maturity and discounts for payment on delivery is analyzed the trade credit price. The results of the analysis reveal that in the country predominate the simple form of trade credit “net terms”. The majority of trade credits are without interest rates, but the other part are with very high effective implicit interest rate, which stimulate moral hazard in debtors’ behaviour and is a reason for late payments.

Suggested Citation

  • Galia Taseva, 2012. "Trade Credit Terms between the Firms in Bulgaria," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 4, pages 110-136.
  • Handle: RePEc:bas:econst:y:2012:i:4:p:110-136
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • G39 - Financial Economics - - Corporate Finance and Governance - - - Other
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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