search query: @author Rajan, R. G. / total: 7
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| Author: | Petersen, M. A. Rajan, R. G. |
| Title: | Trade credit: Theories and evidence |
| Journal: | Review of Financial Studies
1997 : FALL, VOL. 10:3, p. 661-691 |
| Index terms: | TRADE CREDIT FINANCE COMPANIES |
| Language: | eng |
| Abstract: | Firms are more financed by their suppliers than by financial institutions. This paper presents an empirical test of trade credit. The paper focuses on small firms whose access to capital markets can be limited and finds evidence suggesting that firms use more trade credit when credit from financial institutions is not available. Suppliers have their reasons to lend to constrained firms: they have a comparative advantage in getting information about buyers; they can liquidate assets more efficiently; they have an implicit equity stake in the firms. |
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