Investigation of Trade Credit Demand Patterns in Effect with Firm-Bank Relationship: A Panel Data Approach
Vol. 5 No. 3 (2015), Articles
Vol. 5 No. 3 (2015)

Investigation of Trade Credit Demand Patterns in Effect with Firm-Bank Relationship: A Panel Data Approach

https://doi.org/10.18488/journal.1006/2015.5.3/1006.3.46.54
Jaleel Ahmed
School of Management, Harbin Institute of Technology, Harbin, 150001, P. R. China
Hui Xiaofeng
School of Management, Harbin Institute of Technology, Harbin, 150001, P. R. China
Shahid Kalim Khan
School of Management, Harbin Institute of Technology, Harbin, 150001, P. R. China
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Keywords

Trade credit, Bank relationships, Bank loan, Commercial banks, KSE

How to Cite

Ahmed, J. ., Xiaofeng, H. ., & Khan, S. K. . (2015). Investigation of Trade Credit Demand Patterns in Effect with Firm-Bank Relationship: A Panel Data Approach . Journal of Asian Business Strategy, 5(3), 46–54. https://doi.org/10.18488/journal.1006/2015.5.3/1006.3.46.54
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Abstract

This research paper investigates the behavior of non-financial firms towards trade credit demand in a developing economy while focusing on firm-bank relationship. We have analyzed data from 2005 to 2011 for 220 listed non-financial firms, including manufacturing and services industries. This study reveals that joint board of directors of a firm and a commercial bank leads to easy availability of bank loan and thus decrease firm’s demand for trade credit. Moreover, some control variables like fixed assets, inventory and size has been found significant for trade credit demand.

https://doi.org/10.18488/journal.1006/2015.5.3/1006.3.46.54
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