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The Sino-U.S. trade war: Challenges for trade credit financing and the role of corporate culture

Author

Listed:
  • Chen, Yuyou
  • Cheng, Sirui
  • Zhang, Yuning

Abstract

This research demonstrates that the Sino-U.S. trade war decreases the acquisition of trade credit of the firms exposed to risk in trade with the U.S., and a strong corporate culture can mitigate the adverse effects of the Sino-U.S. trade war outbreak on Chinese firms. We also find that a strong corporate culture can help enhance firms' innovation and transparency, boosting product competitiveness and upstream suppliers' trust. These effects are more pronounced in non-state-owned enterprises. We show that international trading conflict hurts the financing of Chinese enterprises, and well-established informal institutions can mitigate these adverse effects.

Suggested Citation

  • Chen, Yuyou & Cheng, Sirui & Zhang, Yuning, 2025. "The Sino-U.S. trade war: Challenges for trade credit financing and the role of corporate culture," Pacific-Basin Finance Journal, Elsevier, vol. 91(C).
    • Handle: RePEc:eee:pacfin:v:91:y:2025:i:c:s0927538x2500040x
    DOI: 10.1016/j.pacfin.2025.102703
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    JEL classification:

    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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