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Heterogeneous effects of public listing on the usage of trade credit: Evidence from Korean chaebol versus non-chaebol firms

Author

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  • Im, Hyun Joong
  • Jung, Inji
  • Kim, Jiyeon

Abstract

Using a unique dataset of Korean firms, we demonstrate that the effects of public listing on the usage of trade credit are heterogeneous between chaebol and non-chaebol firms. While we find a significant negative relationship between public listing and the usage of trade credit for non-chaebol firms, we do not find any significant relationship for chaebol firms. Consistent with prior literature, public listing allows non-chaebol firms to have greater access to cheaper and less risky sources of external capital, thereby relying less on supplier financing, that is, using less trade credit. The lack of a significant impact for chaebol firms could be attributed to the effectiveness of their internal capital markets, which relax their financial constraints. These findings provide additional evidence supporting well-functioning internal capital markets among Korean chaebol firms.

Suggested Citation

  • Im, Hyun Joong & Jung, Inji & Kim, Jiyeon, 2025. "Heterogeneous effects of public listing on the usage of trade credit: Evidence from Korean chaebol versus non-chaebol firms," Research in International Business and Finance, Elsevier, vol. 76(C).
    • Handle: RePEc:eee:riibaf:v:76:y:2025:i:c:s0275531925000558
    DOI: 10.1016/j.ribaf.2025.102799
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    More about this item

    Keywords

    Trade credit; Public listing; Group affiliation; Financial constraints; Internal capital markets;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • 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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