 Does strategic deviation influence firms’ use of supplier finance?Xiaomeng Charlene Chen, Stewart Jones, Mostafa Monzur Hasan, Ruoyun Zhao and Nurul Alam Journal of International Financial Markets, Institutions and Money, 2023, vol. 85, issue C Abstract: We investigate how strategic deviation, capturing the extent to which firms’ resource allocations or commitments deviate from those of industry peers, affects trade credit policy. We find that it increases firms’ use of supplier-provided trade credit. This finding is noticeably more pronounced among firms exhibiting higher information asymmetry but perceptibly weaker among firms with fewer financing constraints and stronger corporate governance attributes. Our analysis also reveals that strategically deviant firms borrow less from banks and that the use of more trade credit by strategically deviant firms is associated with higher market valuation. Our results are robust and highlight that strategic deviation has important implications for corporate trade credit policy. Keywords: Strategic deviation; Trade credit; Information asymmetry (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:intfin:v:85:y:2023:i:c:s1042443123000550 DOI: 10.1016/j.intfin.2023.101787 Access Statistics for this article Journal of International Financial Markets, Institutions and Money is currently edited by I. Mathur and C. J. Neely More articles in Journal of International Financial Markets, Institutions and Money from Elsevier |
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