Browsing by Author "Tang, Ying"
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Item Open Access Modelling trust evolution within small business lending relationships(Springer, 2018-09-01) Tang, Ying; Moro, Andrea; Sozzo, Sandro; Li, ZhiyongTrust is a key dimension in the principal-agent relationship and it has been studied extensively. However, the dynamics, evolution, and intrinsic motivation and mechanisms have received less attention. This paper investigates the intrinsic motivation of trust and it proposes a theoretical model of trust evolution that is based on the notion of ‘trust response’ and ‘trust spiral’. We then specifically focus on trust within the lending relationship between banks and small businesses, and we run numerical simulations to further illustrate the evolution of involved mutual trust over time. Our model provides implications for future research in both trust evolution and small business lending relationships.Item Embargo Trade credit and firm efficiency: evidence from Chinese manufacturing firms(Taylor & Francis, 2023-02-02) Tang, Ying; Xu, Lu; Guo, Shijun; Moro, AndreaOur work focuses on the impact of trade credit financing on firm efficiency exploiting a sample of Chinese manufacturing listed firms for the period 2004 to 2018. We find that trade credit significantly improves firm efficiency. This positive association is stronger in firms located in regions with higher levels of social trust, during periods with higher economic policy uncertainty and in times of economic downturn. We reveal three economic mechanisms underlying our baseline findings: alleviating financial constraints, mitigating agency conflicts, and reducing transaction costs.Item Open Access Trade credit in China: Exploring the link between short term debt and payables(Elsevier, 2019-11-04) Tang, Ying; Moro, AndreaTrade credit constitutes an essential element of short-term financing for most firms, especially for small and medium-sized enterprises. This paper investigates the dynamics between short-term bank debt and payables among 1525 Chinese small and medium-sized listed companies over the period of 2008–2016. The results suggest that an increase in stock and receivables is financed by both bank credit and payables. In addition, we find that bank credit and payables substitute each other. We also uncover a strong substitution effect among weak firms, possibly linked to the fact that weak firms struggle to access additional bank finance and thus are forced to rely on suppliers to support their growth. The substitution effect between payables and bank credit is robust to different cash conversion cycles and to the firm's liquidity.