Trade Credit, Financial Intermediary Development, and Industry Growth

Fisman, Raymond ; Love, Inessa

World Bank, Washington, DC

关键词: ACCOUNTING;    ACCOUNTING STANDARDS;    ADVERSE SELECTION;    ASSETS;    ASYMMETRIC INFORMATION;   

DOI  :  10.1596/1813-9450-2695
RP-ID  :  WPS2695

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Recent empirical work has shown thatfinancial development is important for economic growth,since well-developed financial markets are more effective atallocating capital to firms with high-value projects. Thisraises the question of whether firms with high returnprojects in countries with poorly developed financialinstitutions, are able to draw on alternative sources ofcapital, to offset the effects of deficient (formal)financial intermediaries. Recent work suggests that implicitborrowing, in the form of trade credit, may provide one suchsource of funds. Using the methodology of Rajan and Zingales(1998), the authors show that in countries with relativelyweak financial institutions, industries with greaterdependence on trade credit financing (measured by the ratioof accounts payable to total assets) grow faster thanindustries that rely less on such credit. Furthermore,consistent with the notion that young firms may not usetrade credit, the authors show that most of the effect theyreport, comes from growth in preexisting firms, rather thanfrom an increase in the number of firms.