Trade credit in China: evidence from unlisted companies

[摘要] This thesis analyses the use of trade credit in China, relying on balance sheet information for a large sample of unlisted companies over the period 2004-2007. We first investigate which factors drive the extension and the obtainment of trade credit. Private companies extend less trade credit the higher the amount of inventories they hold and the lower the share of capital owned by foreign agents. Consistent with the Triangle Debt Dilemma, state-owned enterprises and collective enterprises are more likely to obtain trade credit if they have previously extended it. We then examine the effect of net trade credit, measured as accounts payable minus accounts receivable, on the capital structure. We show that net trade credit is positively associated with total and short-term debt. This relationship holds in those provinces with high levels of marketization and it is valid for private and foreign firms only if located in the most developed provinces. Finally, we analyze how accounts payable and accounts receivable affect the extensive margin of exports. Accounts payable influence the probability of exporting through an inverted U-shaped relationship for all ownership types. However, the nonlinearity holds also for accounts receivable only for private companies.

[发布机构] University:University of Birmingham;Department:Birmingham Business School, Department of Economics

[关键词] D History General and Old World;DS Asia