Research on U-shaped relationship between short-term debt for long-term use and supply chain enterprise default risk: Evidence from Chinese listed firms

Huaqiao Shen and Jinlong Chen

PLOS ONE, 2023, vol. 18, issue 10, 1-20

Abstract: This paper empirically investigates the impact mechanism of short-term debt for long-term use and the default risk of supply chain firms with the data of Chinese A-share listed firms from 2007 to 2021. The study shows that there is a significant U-curve relationship between short-term debt for long-term use and supply chain firms’ default risk, and too high or too low a level of short-term loans and long-term investments will worsen firms’ default risk. In addition, firm performance plays an mediating effect in the process of short-term debt for long-term investment affecting the default risk of supply chain firms. Finally, customer effect and firm heterogeneity play a moderating role in the impact of short-term loans and long-term investments on the default risk of supply chain firms, and the U-shaped relationship will be strengthened under the high-intensity customer effect. This study has important theoretical and practical significance for analyzing the impact of default risk contagion in supply chain enterprises.

Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:plo:pone00:0293284

DOI: 10.1371/journal.pone.0293284

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