TRADE CREDIT IN ITALY: FINANCING TO SELL

Year 2016, Volume: 5 Issue: 3, 318 - 338, 30.09.2016

Candida Bussoli Claudio Giannotti

https://doi.org/10.17261/Pressacademia.2016321975

Abstract

The analysis considers Italian SMEs and investigates,
over the years 2006-2011, the existence of interdependencies between trade
credit policy and trade debt policy and the co-existence of conditions of
complementarity and substitutability between trade credit and other financing
sources. Linear regression models on a yearly basis are used and these models
are put under observation for six years.The paper shows that there are
interdependencies between trade credit policy and trade debt policy; trade
credit can be a complementary and substitute source of financing to bank loans;
conditions of substitutability and complementarity can also be observed by
considering separately firms involved in agricultural or industrial activities
and firms that perform services. 

Keywords

Trade credit, trade debt, bank-firm relationship, SMEs, intercompany financing

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