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of SMEs, but empirical findings revealing the positive relationship between trade credit itself and profitability is … still limited. Thus, in this paper, the trade credit effect on the profitability of SMEs from the side of supply and demand … findings showed a positive relationship between accounts payable and profitability, which indicates that SMEs should establish …
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Using a novel dataset of supplier-customer relationships, I develop measures of vertical position of public and private firms in the US economy in order to test trade credit theories. Firms at higher vertical positions have higher profit margins and hold more net trade credit even after...
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