Ekonomik Daralma Dönemlerinde Likidite Kıtlığı ve Ticari Borç Yönetimi
Trade Credit Policies and Shortage of Liquidity in Cycles of Economic Contraction

Summary/Abstract: This study examines the trade credit practices of 11.000 publicly listed firms from 17 countries (9 developed and 8 developing). The results indicate that firms with a lack of short-term liquidity receive more trade credit for a longer duration. It becomes even more pronounced in times of economic contraction. For robustness, both the period of the 2008 financial crisis and a contractionary period are scrutinized. A slowdown in the economy creates opposing effects on firms from developed and developing countries, while the former use less credit for a shorter period; the latter receive more credit for a longer period of time, whereas firms with a shortage of liquidity behave similarly, i.e., they increase the amount and the duration of trade credit. The findings suggest that firms with a lack of liquidity survive troubling times by obtaining more trade credit from their suppliers.

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