Fabrizio Coricelli, Marco Frigerio, Pietro Vozzella
{"title":"The role of institutions in supporting SME financing through the trade credit channel: an empirical analysis of Italian provinces","authors":"Fabrizio Coricelli, Marco Frigerio, Pietro Vozzella","doi":"10.1007/s11187-025-01013-6","DOIUrl":null,"url":null,"abstract":"<p>Trade credit is a relevant channel through which institutional development affects the real economy. When contract enforcement is weak and trust is low, firms engage in opportunistic behavior that is likely to disproportionally penalize small firms, characterized by weak bargaining power with respect to their larger customers or suppliers. This mechanism is particularly relevant during periods of sharp tightening of credit conditions from banks. Exploiting regional variation in Italy, the paper finds that institutional development mitigated the impact of the financial crisis, particularly for smaller firms, by limiting the adverse effects of the trade credit channel on their liquidity conditions.</p>","PeriodicalId":21803,"journal":{"name":"Small Business Economics","volume":"8 1","pages":""},"PeriodicalIF":4.8000,"publicationDate":"2025-02-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Small Business Economics","FirstCategoryId":"96","ListUrlMain":"https://doi.org/10.1007/s11187-025-01013-6","RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS","Score":null,"Total":0}
引用次数: 0
Abstract
Trade credit is a relevant channel through which institutional development affects the real economy. When contract enforcement is weak and trust is low, firms engage in opportunistic behavior that is likely to disproportionally penalize small firms, characterized by weak bargaining power with respect to their larger customers or suppliers. This mechanism is particularly relevant during periods of sharp tightening of credit conditions from banks. Exploiting regional variation in Italy, the paper finds that institutional development mitigated the impact of the financial crisis, particularly for smaller firms, by limiting the adverse effects of the trade credit channel on their liquidity conditions.
期刊介绍：
Small Business Economics: An Entrepreneurship Journal (SBEJ) publishes original, rigorous theoretical and empirical research addressing all aspects of entrepreneurship and small business economics, with a special emphasis on the economic and societal relevance of research findings for scholars, practitioners and policy makers.
SBEJ covers a broad scope of topics, ranging from the core themes of the entrepreneurial process and new venture creation to other topics like self-employment, family firms, small and medium-sized enterprises, innovative start-ups, and entrepreneurial finance. SBEJ welcomes scientific studies at different levels of analysis, including individuals (e.g. entrepreneurs'' characteristics and occupational choice), firms (e.g., firms’ life courses and performance, innovation, and global issues like digitization), macro level (e.g., institutions and public policies within local, regional, national and international contexts), as well as cross-level dynamics.
As a leading entrepreneurship journal, SBEJ welcomes cross-disciplinary research.
Officially cited as: Small Bus Econ
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