 Firms' access to informal financing: The role of shared managers in trade credit accessFeng Ding, Qiliang Liu, Hanzhong Shi, Wenming Wang and Shan Wu Journal of Corporate Finance, 2023, vol. 79, issue C Abstract: We investigate how shared managers and directors (shared M&Ds) with major suppliers affect a firm's access to trade credit. Using a sample of listed firms in China, we find that shared M&Ds play an important role in helping firms obtain trade credit. This favorable effect is strengthened for firms with higher information asymmetry, located in regions with lower social trust, operating in more innovative and heterogeneous industries, and experiencing greater financial constraints. Our findings support the proposition that shared M&Ds can reduce information asymmetry and build mutual trust between firms and their suppliers. This study contributes to the literature on the benefits of social connections within supply chain relationships and the literature on the economic consequences of interlocked managers and directors. Keywords: Trade credit; Shared managers and directors; Customer–supplier relationships (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:79:y:2023:i:c:s0929119923000378 DOI: 10.1016/j.jcorpfin.2023.102388 Access Statistics for this article Journal of Corporate Finance is currently edited by A. Poulsen and J. Netter More articles in Journal of Corporate Finance from Elsevier |
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