 Does trade credit alleviate stock price synchronicity? Evidence from ChinaHuan Liu and Canran Hou International Review of Economics & Finance, 2019, vol. 61, issue C, 141-155 Abstract: This paper investigates the effect of trade credit on stock price synchronicity for Chinese listed firms over 2007–2015. The results provide evidences that firms with more trade credit show lower stock price synchronicity, verifying the information content of trade credit in China. Further, media coverage and customer concentration have moderating effect on the relationship between trade credit and synchronicity. Higher media coverage may weaken the impact of trade credit on stock price synchronicity, but higher customer concentration which is the evidence of long-term supplier-customer relationship will facilitate the disclosure of trade credit's firm-specific information and strengthen the negative relationship between trade credit and stock price synchronicity. Our conclusions are robust to consider the endogeneity between trade credit and stock price synchronicity. Keywords: Trade credit; Stock price synchronicity; Media coverage; Customer concentration; China (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:reveco:v:61:y:2019:i:c:p:141-155 DOI: 10.1016/j.iref.2019.02.003 Access Statistics for this article International Review of Economics & Finance is currently edited by H. Beladi and C. Chen More articles in International Review of Economics & Finance from Elsevier |
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