We employ a novel data set on almost 30,000 trade credit contracts to describe the broad characteristics of the parties that contract together and the key terms of these contracts. Whereas prior work has typically used information on only one side of the buyer-seller transaction, we utilize information on both, allowing for the first analysis of buyer-seller pairs. An equally important distinct...

We investigate how the retailer adjusts optimal ordering policy in the presence of cap-and-trade system and trade credit, and the corresponding changes of the retailer’s total costs and carbon footprint. Trade credit is one of the most used short-term financing tools. Our study shows that carbon emissions trading will shorten the ordering cycle for products that emit more carbon dioxide during ...

The basic financial purpose of an enterprise is maximization of its value. Trade credit management should also contribute to realization of this fundamental aim. Many of the current asset management models that are found in financial management literature assume book profit maximization as the basic financial purpose. These book profitbased models could be lacking in what relates to another aim...

In reality, a seller (e.g., a supplier or a manufacturer) frequently offers his/her buyers trade credit (e.g., permissible delay in payment). Trade credit reduces the buyer's holding cost of inventory and hence attracts new buyers who consider it to be a type of price reduction. On the other hand, granting trade credit also increases the seller's opportunity cost (i.e., the loss of capital oppo...

The purpose of this paper is to address the determinants of trade credit in the Cameroonian context. Based on a sample of 85 Cameroonian companies observed in 2006, the econometric investigations highlight a genuine financial intermediation business close to productive activity. We used a general model incorporating both financial variables, transactional and sociocultural in order to estimate ...

Extending Ireland’s (1994) model, this paper analyzes an international economy where cash or credit can be used for payment. Foreign trade credit is more costly than its domestic analog. A depreciation of the real exchange rate is associated with an external surplus and a reduced share of imports purchased with credit. Economic growth slows when foreign trade credit becomes the predominant mean...

The purpose of the paper is to formulate two uncooperative replenishment models with demand and default risk which are the functions of the trade credit period, i.e., a Nash equilibrium model and a supplier-Stackelberg model. Firstly, we present the optimal results of decentralized decision and centralized decision without trade credit. Secondly, we derive the existence and uniqueness condition...