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Cited by 603Working Capital and Financial PerformanceSupply Chain and Inventory ManagementBanking stability, regulation, efficiency

The DOI matches its Crossref record; 16 of the 16 references it cites were found in a registry or an index.

A Transactions Theory of Trade Credit Use

Ferris, J. Stephen·1981·The Quarterly Journal of Economics
DOI 10.2307/1882390
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Abstract

This paper derives a transactions theory of trade credit use from the motives of trading partners to economize on the joint costs of exchange. In the formal analysis, uncertain delivery time is used to generate a demand by firms to hold inventories of both goods and money. Trade credit is viewed as a mechanism that separates the exchange of money from the uncertainty present in the exchange of goods. By forewarning both trading partners of the timing of money flows, credit permits a reduction in precautionary money holdings and the more effective management of net money accumulations.

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Crossref · 10.2307/1882390

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Metadata

Authors
Ferris, J. S.
Affiliations
Carleton University (CA)
Corresponding author
Ferris, J. Stephen
ORCID
Ferris, J. Stephen
Venue
The Quarterly Journal of Economics
Publisher
Oxford University Press (OUP)
Published
1981-05
Volume
96
Issue
2
Pages
243
ISSN
0033-5533 (ISSN-L)
DOI
10.2307/1882390
OpenAlex
W2013704297
Cited by
603
References
16
Citations by year
2026: 15 · 2025: 32 · 2024: 31 · 2023: 40 · 2022: 33 · 2021: 28 · 2020: 27 · 2019: 35 · 2018: 38 · 2017: 31 · 2016: 25 · 2015: 26 · 2014: 30 · 2013: 26 · 2012: 22
FWCI
2.98
Type
journal article
Language
en
Open access
closed
Locations
  • The Quarterly Journal of Economics (publishedVersion)
  • RePEc: Research Papers in Economics (submittedVersion)
Topics
  • Social Sciences › Business, Management and Accounting › Accounting › Working Capital and Financial Performance
  • Social Sciences › Decision Sciences › Management Science and Operations Research › Supply Chain and Inventory Management
  • Social Sciences › Economics, Econometrics and Finance › Finance › Banking stability, regulation, efficiency
Keywords
trade credit, inventory holding, exchange costs, financial flows

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