Religiosity and cross-country differences in trade credit use

Feng Chen, Xiaolin Chen*, Weiqiang Tan, Lin Zheng

*Corresponding author for this work

    Research output: Contribution to journalArticlepeer-review

    7 Citations (Scopus)
    2 Downloads (Pure)

    Abstract

    Using the firm-level data over 1989–2012 from 53 countries, we find religiosity in a country is positively associated with trade credit use by local firms. Specifically, after controlling for firm- and country-level factors as well as industry and year effects, we show that trade credit use is higher in more religious countries. Moreover, both creditor rights and social trust in a country enhance the positive association between religiosity and trade credit use, while the quality of national-level disclosure mitigates the aforementioned positive association. These results are robust to alternative measures of religiosity, alternative sampling requirements and potential endogeneity concerns.

    Original languageEnglish
    Pages (from-to)909-941
    Number of pages33
    JournalAccounting and Finance
    Volume60
    Issue numberS1
    Early online date1 Jul 2018
    DOIs
    Publication statusPublished - Apr 2020

    Scopus Subject Areas

    • Accounting
    • Finance
    • Economics, Econometrics and Finance (miscellaneous)

    User-Defined Keywords

    • Creditor rights
    • Cross-country differences
    • Religiosity
    • Social trust
    • Trade credit use

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