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Determinants of Trade Credit: A Preliminary Analysis on Construction Sector

Author

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  • Nicoleta Barbuta-Misu

    (Dunarea de Jos University of Galati, Romania)

  • Fitim Deari

    (South East European University, Romania)

Abstract

This paper introduces a preliminary analysis of the correlations between trade credit and some selected measures of financial performance for a sample of 958 firms acting in the construction sector. The examined period covers 2004-2013. The sample derived from Amadeus database contains firms that have sold and bought on credit. Results showed that larger firms offered and used more credit than counterparties. Firms offered and used in same time credit, but not in same level. Firms with higher return on assets and profit margin used and offered less credit from suppliers, respectively to clients. Moreover, more liquid firms used less trade payables.

Suggested Citation

  • Nicoleta Barbuta-Misu & Fitim Deari, 2016. "Determinants of Trade Credit: A Preliminary Analysis on Construction Sector," Risk in Contemporary Economy, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, pages 306-314.
    • Handle: RePEc:ddj:fserec:y:2016:p:306-314
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