Trade Credit: Panel Data Analysis

This paper aims to define the relationship between trade and bank credits during monetary constraints and explain the role of trade credit mechanism in the transmission of monetary policy to the real sector of the economy. The close investigation of the dynamics of trade credits may help to develop policy measures to support SMEs in periods of recessions that constitutes the relevance of the future research. I intend to use panel data for 16 emerging countries and seven-year time period to study the dynamics of trade receivables and trade payables during and after financial crisis of 2008. The research expects to apply methods of descriptive statistics, correlation, cluster and regression analyses. The compilation of the dataset, all calculations and estimation of regressions are made with the help of computer programmes MS Excel, Eviews 8 and R. The results suggest the indicator of the availability of bank credit to be positively correlated with the trade credits provided and received that is consistent with the concept of complementarity between bank and trade credits.