Observatorio de I+D+i UPM

Memorias de investigación
Research Publications in journals:
The trade credit in the Spanish agrofood industry
Year:2011
Research Areas
  • Agrarian economy
Information
Abstract
Selling on credit is rather frequent in Mediterranean countries. Its generalized use can lead to excessive enlargements of the payment periods and consequently can deteriorate the profitability of firms. In spite of the relevance of this problem there are few empirical researches. This work intends to fill this gap and to shed light on the factors related to the extension of trade credit. In the theoretical and empirical literature, different motives have been proposed to explain this issue: a mechanism to reduce transaction costs, a financial alternative to the bank system and an additional tool to improve commercial activities. To contrast these ideas a panel of 388 firms of the Spanish agrofood industry has been taken, and static and dynamic regression models have been estimated by using robust methods to heteroskedasticity, autocorrelation and endogeneity of the explanatory variables. The results confirm that trade credit receivable is associated with more active firms and with cheaper bank financing. Other factors with positive relationships are short-term bank debts and accounts payable. These findings are consistent with commercial motives, rather than a pure financial view, in the sense that financial distressed producers extend trade credit as a way of promoting their products and in turn increasing their sales.
International
Si
JCR
Si
Title
Mediterranean Journal of Economics, Agriculture and Environment (New Medit)
ISBN
1594-5685
Impact factor JCR
0,099
Impact info
Volume
10
Journal number
2
From page
51
To page
57
Month
JUNIO
Ranking
Participants
  • Autor: Silverio Alarcon Lorenzo (UPM)
Research Group, Departaments and Institutes related
  • Creador: Departamento: Economía y Ciencias Sociales Agrarias
S2i 2020 Observatorio de investigación @ UPM con la colaboración del Consejo Social UPM
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