Publications
Publications
- October 2020
- Journal of Corporate Finance
Peer Influence on Trade Credit
By: Daniel Gyimah, Michael Machokoto and Anywhere (Siko) Sikochi
Abstract
We examine the influence of peer firms on trade credit policies of listed firms in the United States. We posit and find evidence that firms mimic their peers in formulating trade credit policies. The findings are more pronounced for firms in highly competitive product markets. Our results also show that firms not only mimic peers in similar circumstances, but they also mimic their more and/or less successful peer firms. These within-group and bidirectional effects highlight the importance of trade credit as a competitive tool in the product markets. Our results are robust to different methods of selecting peers, sampling, different proxies, and estimation techniques.
Keywords
Citation
Gyimah, Daniel, Michael Machokoto, and Anywhere (Siko) Sikochi. "Peer Influence on Trade Credit." Journal of Corporate Finance 64 (October 2020).