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Common ownership along supply chain and trade credit: Evidence from China

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  • Xu, Yanhui

Abstract

This paper explores the impact of common ownership along supply chain on trade credit based on customer-supplier relationships of Chinese listed firms. The results show that common ownership along supply chain can increase the trade credit. This effect is achieved through two channels: alleviating information asymmetry between customers and suppliers and participating in firm decision making. The effect of common ownership along supply chain on improving trade credit is more significant for non-state owned firms in China. This study provides a reference for equity linkages and financial governance in the supply chain.

Suggested Citation

  • Xu, Yanhui, 2023. "Common ownership along supply chain and trade credit: Evidence from China," Finance Research Letters, Elsevier, vol. 56(C).
    • Handle: RePEc:eee:finlet:v:56:y:2023:i:c:s154461232300483x
    DOI: 10.1016/j.frl.2023.104111
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    References listed on IDEAS

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    Cited by:

    1. Zheng, Xiaxuan & Chen, Yueyan, 2024. "Does supply-chain-finance help to improve the efficiency of outward foreign direct investment?," Finance Research Letters, Elsevier, vol. 59(C).

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    More about this item

    Keywords

    Supply chain; Common ownership; Trade credit; Information asymmetry;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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