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Article: Bank loans vs. Trade credit;Evidence from China

TitleBank loans vs. Trade credit;Evidence from China
Authors
KeywordsBank Loans
Firm Growth
Firm Performance
Trade Credit
Issue Date2012
PublisherBlackwell Publishing Ltd. The Journal's web site is located at http://www.blackwellpublishing.com/journals/ECOT
Citation
Economics Of Transition, 2012, v. 20 n. 3, p. 457-480 How to Cite?
AbstractUsing a World Bank dataset of Chinese firms, we investigate the relative importance of bank loans and trade credit in promoting firm performance. To deal with possible endogeneity issues, we employ distinct and separable instrumental variables for bank loans and trade credit. We find that access to bank loans is central to improving firm performance and growth, while the availability of trade credit is much less important. Our results suggest that trade credit cannot effectively substitute for bank loans. Overall, our findings suggest the need for further development of China's formal financial institutions, which would enable the non-state sector to grow much faster than it has grown in recent decades. © 2012 The Authors.
Persistent Identifierhttp://hdl.handle.net/10722/178090
ISSN
2015 Impact Factor: 0.66
2015 SCImago Journal Rankings: 0.388
ISI Accession Number ID
References

 

DC FieldValueLanguage
dc.contributor.authorDu, Jen_US
dc.contributor.authorLu, Yen_US
dc.contributor.authorTao, Zen_US
dc.date.accessioned2012-12-19T09:41:52Z-
dc.date.available2012-12-19T09:41:52Z-
dc.date.issued2012en_US
dc.identifier.citationEconomics Of Transition, 2012, v. 20 n. 3, p. 457-480en_US
dc.identifier.issn0967-0750en_US
dc.identifier.urihttp://hdl.handle.net/10722/178090-
dc.description.abstractUsing a World Bank dataset of Chinese firms, we investigate the relative importance of bank loans and trade credit in promoting firm performance. To deal with possible endogeneity issues, we employ distinct and separable instrumental variables for bank loans and trade credit. We find that access to bank loans is central to improving firm performance and growth, while the availability of trade credit is much less important. Our results suggest that trade credit cannot effectively substitute for bank loans. Overall, our findings suggest the need for further development of China's formal financial institutions, which would enable the non-state sector to grow much faster than it has grown in recent decades. © 2012 The Authors.en_US
dc.languageengen_US
dc.publisherBlackwell Publishing Ltd. The Journal's web site is located at http://www.blackwellpublishing.com/journals/ECOTen_US
dc.relation.ispartofEconomics of Transitionen_US
dc.rightsCreative Commons: Attribution 3.0 Hong Kong License-
dc.subjectBank Loansen_US
dc.subjectFirm Growthen_US
dc.subjectFirm Performanceen_US
dc.subjectTrade Crediten_US
dc.titleBank loans vs. Trade credit;Evidence from Chinaen_US
dc.typeArticleen_US
dc.identifier.emailLu, Y: xzhongkanson@business.hku.hken_US
dc.identifier.emailTao, Z: ztao@hku.hken_US
dc.identifier.authorityLu, Y=rp01081en_US
dc.identifier.authorityTao, Z=rp01097en_US
dc.description.naturepreprinten_US
dc.identifier.doi10.1111/j.1468-0351.2012.00439.xen_US
dc.identifier.scopuseid_2-s2.0-84868583016en_US
dc.identifier.hkuros207807-
dc.relation.referenceshttp://www.scopus.com/mlt/select.url?eid=2-s2.0-84868583016&selection=ref&src=s&origin=recordpageen_US
dc.identifier.volume20en_US
dc.identifier.issue3en_US
dc.identifier.spage457en_US
dc.identifier.epage480en_US
dc.identifier.isiWOS:000304818200003-
dc.publisher.placeUnited Kingdomen_US
dc.identifier.scopusauthoridDu, J=8850784100en_US
dc.identifier.scopusauthoridLu, Y=54901610300en_US
dc.identifier.scopusauthoridTao, Z=7201884505en_US

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