 The impact of more able managers on corporate trade creditHui Liang James, Thanh Ngo and Hongxia Wang Journal of Behavioral and Experimental Finance, 2023, vol. 40, issue C Abstract: We investigate how high-ability managers affect trade credit policies of U.S. publicly traded companies from 2003 to 2016. Consistent with the prediction of an “Imbalance of power” in the supply chain, we find that firms with more able managers implement more favorable trade credit policies with both upstream and downstream business partners (i.e., fewer trade credit days in receivables, more trade credit days in payables, and lower net trade credit days), indicating that managerial ability is an important determinant of corporate trade credit. Our cross-sectional analyses provide further support for the bargaining power view of trade credit. The results are robust to various tests mitigating the endogeneity concerns. This study sheds light on the importance of more able managers in working capital and supply chain management. Keywords: Managerial ability; More able managers; Trade credit; Days in receivables; Days in payables; Net trade credit days; Firm value (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:beexfi:v:40:y:2023:i:c:s2214635023000710 DOI: 10.1016/j.jbef.2023.100857 Access Statistics for this article Journal of Behavioral and Experimental Finance is currently edited by Michael Dowling and Jürgen Huber More articles in Journal of Behavioral and Experimental Finance from Elsevier |
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