Inventory composition and trade credit

Simona Mateut, Paul Mizen and Ydriss Ziane

International Review of Financial Analysis, 2015, vol. 42, issue C, 434-446

Abstract: This empirical paper uses a panel of about half a million observations for French firms across economic sectors to investigate how the type of inventories can affect firms' incentives to use trade credit. We find evidence that trade credit extended is influenced by the extent to which firms hold different types of inventories. Moreover, we show that the strength of the relationship varies across economic sectors. Finally, we find that as buyers process goods, the sellers' incentives to extend trade credit diminish.

Keywords: Trade credit; Inventories (search for similar items in EconPapers)
JEL-codes: D22 G31 G32 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:42:y:2015:i:c:p:434-446

DOI: 10.1016/j.irfa.2015.09.008

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