 It is a marathon, not a sprint: The impact of supply chain finance on firms’ short-term debt for long-term investmentsJun Bu, Yanfeng Chang, Tianlun Fei and Xueying Li Pacific-Basin Finance Journal, 2025, vol. 93, issue C Abstract: This paper investigates the role of supply chain finance as a promising alternative solution to balance the trade-off between the benefits and risks associated with using short-term debt for long-term investments. Using data on Chinese A-share listed companies from 2007 to 2022, we find that firms’ participation in supply chain finance effectively discourages their use of short-term debt to finance long-term investments. We explore three underlying channels through which supply chain finance influences this practice and demonstrate that supply chain finance alleviates information asymmetry, enhances credit allocation efficiency, and improves firms’ operational efficiency, thereby reducing their reliance on short-term debt for long-term investments. Our findings contribute to the literature by providing new insights into the impact of supply chain finance on corporate financing behavior and investment decisions. Keywords: Supply chain finance; Short-term debt for long-term investments; Information asymmetry; Credit allocation efficiency; Operational efficiency (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:pacfin:v:93:y:2025:i:c:s0927538x25002227 DOI: 10.1016/j.pacfin.2025.102885 Access Statistics for this article Pacific-Basin Finance Journal is currently edited by K. Chan and S. Ghon Rhee More articles in Pacific-Basin Finance Journal from Elsevier |
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