The DOI matches its Crossref record; 35 of the 35 references it cites were found in a registry or an index.
Trade Credit and the Bank Lending Channel
Open accessAbstract
The bank lending channel theory posits that during monetary contractions banks restrict some firms' loans, thus reducing their desired investment independently of interest rates.Previous research finds small firms reduce, while large firms accelerate, loan growth.We find that small firms increase trade credit, a substitute credit, indicating a strong loan demand.It supports the bank lending channel: they do not voluntarily cut bank loans since they increase a less-desirable alternative.Using trade credit is propitious since unlike commercial paper (investigated by previous researchers), it is widely used by the small firms suffering the loan decline.Surprisingly, we also find large firms increase trade credit, a puzzle since they are typically assumed to have wide access to other credit.Using individual firm data, we find the reasons large firms use trade credit are financial in nature: those without a bond rating increase trade credit (i.e.without access to open market credit).As relatively few firms have this mark of quality, it implies that more firms are affected by credit constraints than previously believed.
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Cites
Sims, C. A. (1980) · Econometrica · doi:10.2307/1912017 · Cited by 12,727
The Benefits of Lending Relationships: Evidence from Small Business Data
PETERSEN, M. A., & RAJAN, R. G. (1994) · The Journal of Finance · doi:10.1111/j.1540-6261.1994.tb04418.x · Cited by 5,440
Inside the black box: the credit channel of monetary policy transmission
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The determinants and implications of corporate cash holdings
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The effect of credit market competition on lending relationships
Petersen, M. A., & Rajan, R. G. (1995) · The Quarterly Journal of Economics · doi:10.2307/2118445 · Cited by 3,294
The federal funds rate and the channels of monetary transmissionPreprint
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Monetary policy, business cycles, and the behavior of small manufacturing firms
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The financial accelerator, and the flight to quality
Bernanke, B., Gertler, M., & Gilchrist, S. (1996) · The Review of Economics and Statistics · doi:10.2307/2109844 · Cited by 2,351
The Economics of Money, Banking and Financial Markets
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Debt, Liquidity Constraints, and Corporate Investment: Evidence from Panel Data
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Cited by
Trade credit, financial intermediary development and industry growth
Fisman, R., & Love, I. (2003) · The Journal of Finance · doi:10.1111/1540-6261.00527 · Cited by 1,052
What You Sell Is What You Lend? Explaining Trade Credit Contracts
Giannetti, M., Burkart, M., & Ellingsen, T. (2011) · Review of Financial Studies · doi:10.1093/rfs/hhn096 · Cited by 938
Trade Credit, Risk Sharing, and Inventory Financing Portfolios
Yang, S. A., & Birge, J. R. (2018) · Management Science · doi:10.1287/mnsc.2017.2799 · Cited by 561
Firms as liquidity providers: Evidence from the 2007–2008 financial crisis
Garcia-Appendini, E., & Montoriol-Garriga, J. (2013) · Journal of Financial Economics · doi:10.1016/j.jfineco.2013.02.010 · Cited by 499
Casey, E., & O'Toole, C. M. (2014) · Journal of Corporate Finance · doi:10.1016/j.jcorpfin.2014.05.001 · Cited by 414
Metadata
- Authors
- Nilsen, J. H.
- Venue
- Journal of Money, Credit, and Banking
- Publisher
- Project MUSE
- Published
- 2002
- Volume
- 34
- Issue
- 1
- Pages
- 226-253
- ISSN
- 0022-2879 (ISSN-L)
- 1538-4616
- OpenAlex
- W3122858800
- Cited by
- 622
- References
- 35
- FWCI
- 44.33
- Type
- journal article
- Language
- en
- Open access
- bronze
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Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
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