Trade credit, creditor protection and banking crisis

Sonia Baños-Caballero, Pedro J. García-Teruel and Pedro Martínez-Solano

Global Finance Journal, 2023, vol. 57, issue C

Abstract: This paper analyzes the effect of banking crises on the trade credit provided to customers and whether this effect depends on the strength of a country's legal protection of creditors. The results indicate that trade credit extensions increase in times of crisis, although this increase is smaller in countries where creditors are well protected; however, no differences are observed in trade credit extensions between countries with weak and strong creditor protection in non-crisis periods.

Keywords: Trade credit; Legal system; Creditor rights protection; Enforcement; Banking crises (search for similar items in EconPapers)
JEL-codes: G30 G39 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:glofin:v:57:y:2023:i:c:s1044028323000297

DOI: 10.1016/j.gfj.2023.100834

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