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Big data in tax enforcement and trade credit: Evidence from China

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  • Song, Gaoya
  • Li, Quan

Abstract

This study investigates how big data in tax enforcement (BDTE) affects trade credit. We demonstrate that BDTE not only significantly enhances the trade credit acquisition of enterprises but also boosts the trade credit supply. The path analyses indicate that BDTE increases firms' financing constraints and inhibits corporate earnings management, therefore improving trade credit acquisition and supply. Furthermore, the reinforcing effect of BDTE on corporate trade credit acquisition is more pronounced among low supplier concentration, low quality enterprises and state-owned enterprises (SOEs). The positive relationship between BDTE and trade credit supply is stronger among low supplier concentration, manufacturing enterprises and non-SOEs.

Suggested Citation

  • Song, Gaoya & Li, Quan, 2025. "Big data in tax enforcement and trade credit: Evidence from China," Research in International Business and Finance, Elsevier, vol. 76(C).
    • Handle: RePEc:eee:riibaf:v:76:y:2025:i:c:s0275531925000686
    DOI: 10.1016/j.ribaf.2025.102812
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    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm

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