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Climate policy uncertainty and corporate trade credit provision

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  • Ning, Zihao
  • Xu, Zhibo

Abstract

This study examines how uncertainty in Chinese climate policies influences firms’ trade credit decisions. Using data from Chinese A-share listed companies between 2010 and 2022, we find that increased climate policy uncertainty is associated with reduced trade credit provision. These findings remain robust across various endogeneity tests and additional verification methods. Our analysis reveals that financial constraints, operating risk, and information opacity are three plausible channels through which climate policy uncertainty to inhibit trade credit provision. Furthermore, cross-sectional analyses demonstrate that this negative relationship is more pronounced among non-state-owned enterprises, firms with weak political connections, and companies operating in less competitive product markets. Overall, this paper advances the academic discourse on trade credit determinants and provides new insights into how climate policy uncertainty affects corporate credit provision decisions.

Suggested Citation

  • Ning, Zihao & Xu, Zhibo, 2026. "Climate policy uncertainty and corporate trade credit provision," Research in International Business and Finance, Elsevier, vol. 83(C).
    • Handle: RePEc:eee:riibaf:v:83:y:2026:i:c:s0275531926000206
    DOI: 10.1016/j.ribaf.2026.103293
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    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • 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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