| Item Type |
Journal paper
|
| Abstract |
Using a supplier-client matched sample, we study the effect of the 2007-2008 financial crisis on between-firm liquidity provision. Consistent with a causal effect of a negative shock to bank credit, we find that firms with high pre-crisis liquidity levels increased the trade credit extended to other corporations and subsequently experienced better performance as compared to ex-ante cash-poor firms. Trade credit taken by constrained firms increased during this period. These findings are consistent with firms providing liquidity insurance to their clients when bank credit is scarce and provide an important precautionary savings motive for accumulating cash reserves. |
| Authors |
García-Appendini, Emilia & Montoriol-Garriga, Judit |
| Journal or Publication Title |
Journal of Financial Economics |
| Language |
English |
| Keywords |
Trade credit, corporate liquidity, crisis, financial constraints, cash, lines of credit |
| Subjects |
economics |
| HSG Classification |
not classified |
| Refereed |
Yes |
| Date |
July 2013 |
| Publisher |
Elsevier |
| Place of Publication |
Amsterdam |
| Volume |
109 |
| Number |
1 |
| Page Range |
272-291 |
| Number of Pages |
20 |
| ISSN |
0304-405X |
| ISSN-Digital |
1879-2774 |
| Publisher DOI |
https://doi.org/10.1016/j.jfineco.2013.02.010 |
| Depositing User |
Prof. PhD Emilia García-Appendini
|
| Date Deposited |
10 Oct 2012 18:18 |
| Last Modified |
23 Aug 2016 11:14 |
| URI: |
https://www.alexandria.unisg.ch/publications/217208 |
Firms as liquidity providers: Evidence from the 2007-2008 financial crisis
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