Mixed ownership reform and trade credit: Evidence from China

Gaoya Song and Quan Li

International Review of Financial Analysis, 2024, vol. 95, issue PC

Abstract: We investigate the impact of mixed ownership reform (MOR) intensity on trade credit obtained by state-owned enterprises (SOEs) in China from 2009 to 2021. Drawing on a novel, hand-collected database, we find that MOR intensity has a significantly negative effect on trade credit. The path analyses show that financial constrains and corporate profitability are the channel of our main finding. Moreover, the negative relationship between MOR intensity and trade credit is more pronounced for central SOEs, firms facing weaker market competition or higher supplier concentration. This study explores the causes of an SOE's trade credit demand and the consequences of MOR in China.

Keywords: Mixed ownership reform; Bargaining power; Trade credit (search for similar items in EconPapers)
JEL-codes: D22 E61 G34 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:95:y:2024:i:pc:s105752192400423x

DOI: 10.1016/j.irfa.2024.103491

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