Since 2014
TRADE CREDIT AND FIRM PERFORMANCE: A REVIEW OF CLASSICAL LITERATURE
European Journal of Economic and Financial Research
View Archive Info| Field | Value | |
| Title |
TRADE CREDIT AND FIRM PERFORMANCE: A REVIEW OF CLASSICAL LITERATURE
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| Creator |
Egbo, Obiamaka P.
Ezeaku, Hillary Chijindu |
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| Subject |
trade credit; firm performance
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| Description |
Firms with access to financial institutions credits have been found to extend more trade credits to customers. This is based on the fact that the firm is believed to have more information about the customers compared to external financiers. This conjecture points to the fact that the information advantage which the firm has over the conventional lenders like banks may have been due to regular and repeated interactions with the customers, sometimes on a personal level. Suppliers are more likely to offer more trade credit to customers with whom they have had long business relationship. From the standpoint of extant literature, this paper reviews the nexus between trade credit and firm performance. Based on the reviews, there seem to be a consensus that trade credit is positively related to firm performance. However, monetary policy stance is found to be a key determinant of trade credit supplies. This is because contractionary monetary policies are expected to have effects on trade credit relative to sales and ultimately have implications on firm profitability. JEL: F10, L20, L22 Article visualizations:
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| Publisher |
Open Access Publishing Group
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| Contributor |
—
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| Date |
2020-07-07
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| Type |
info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion — |
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| Format |
application/pdf
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| Identifier |
https://oapub.org/soc/index.php/EJEFR/article/view/853
10.46827/ejefr.v0i0.853 |
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| Source |
European Journal of Economic and Financial Research; Volume 2, Issue 1, 2017
25019430 25019430 |
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| Language |
eng
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| Relation |
https://oapub.org/soc/index.php/EJEFR/article/view/853/1434
https://oapub.org/soc/index.php/EJEFR/article/view/853/1435 https://oapub.org/soc/index.php/EJEFR/article/view/853/1436 |
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| Rights |
Copyright (c) 2020 Obiamaka P. Egbo, Hillary Chijindu Ezeaku
http://creativecommons.org/licenses/by/4.0 |
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