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Downtown Athens, GA
March 2024

Publications

  1. Access to Debt and the Provision of Trade Credit, with Matthew T. Billett and Janet Gao.

  2. Overlapping Ownership Along the Supply Chain. (Solo)

  3. The Lender’s Lender: Trade Credit and the Monitoring Role of Banks. (Solo)

Working Papers

(abstracts below)

  1. (Don’t) Feed the Mouth that Bites: Trade Credit Spillover Through Common Suppliers with Jie (Jack) He, Han Xia, and Liyan Yang   SSRN link 

  2. Trust in Cultural Institutions and Interfirm Cooperation: Evidence from Religious Scandals, with Quentin Dupont.​  (R&R, JFQA)  SSRN link

  3. One Sows and Another Reaps: Outsourcing Innovation to Suppliers. (Solo)   SSRN link

  4. When Push Comes to Shove: Selective Trade Credit Generosity in a Global Pandemic (Solo)   SSRN link

  5. The Hidden Risk of a Safe Customer: Regulatory Fragmentation and Government Contracting with Jon Kalodimos     SSRN link 

(abstracts below)

Abstracts, etc. (published papers)

Access to Debt and the Provision of Trade Credit (with Matt Billett & Janet Gao)

  • Management Science, accepted.

  • Abstract: We examine how access to debt markets affects firms' incentives to provide trade credit. Using hand-collected trade credit data between customer-supplier pairs and exogenous shocks to firms' debt capacity, we show that increased access to debt reduces firms' provision of trade credit per dollar of sales. The decline in trade credit is concentrated on ex-ante powerful customers, but absent for weak ones, suggesting that better access to debt improves firms' bargaining position relative to powerful customers. The decline in trade credit leads customers to cut investment, increase leverage, and scale back trade credit provision to firms further downstream.

  • Presentations: University of Georgia (May 2020), Eastern Finance Association (Virtual, 2021), Eastern Financial Management Association (Virtual, 2021), Financial Management Association (Denver, CO, 2021), American Finance Association (New Orleans, 2023), European Finance Association (Amsterdam, NL, 2023)

  • Note: Previously circulated as “The Collateral Role of Trade Credit”

The Lender’s Lender: Trade Credit and the Monitoring Role of Banks (solo)

  • Journal of Financial and Quantitative Analysis, forthcoming.

  • Abstract: A firm's role as lender to its customers (via trade credit) is influenced by the firm's own lenders. With a novel dataset of trade credit between U.S. public companies, I find that firms limit customer credit concentrations, extending less generous trade credit to customers as the firms' sales dependence on them increases. Evidence points to lenders influencing firms to limit credit concentrations: First, cross-sectional variation shows stronger results with greater lender monitoring intensity. Second, analysis of granular loan contract details reveals that concentration limits in borrowing base formulas are a clear, previously unexplored way banks influence trade credit policies.

  • Presentations: Indiana University (2018); 2019 job market talks at Michigan State University, FDIC, Southern Methodist University, Notre Dame, University of Georgia, University of Illinois, Tulane University, University of South Carolina; Eastern Financial Association (Miami, FL, 2019); Financial Management Association (New Orleans, 2019); Midwest Financial Association (Virtual conference, 2020)

  • Best paper in Corporate Finance at FMA 2019

  • Covered in Terry Takeaways, January 6, 2020

  • Note: An earlier draft circulated as “The Economics of Trade Credit: Risk and Power”

​Overlapping Ownership Along the Supply Chain (solo)

  • Journal of Financial and Quantitative Analysis (2025).

  • Abstract: I find overlapping institutional ownership (OIO) in a customer and supplier increases the duration of their supply chain relationship. Results are stronger when vertical holdup is more severe. A quasi-natural experiment around mergers of financial institutions provides causal evidence of OIO improving relationship survival rates. Concurrent with longer-lived relationships, valuations and innovation increase, consistent with OIO effects on relationship longevity being beneficial. I find evidence of OIO strengthening relationships via an internalization channel: With more OIO, partners cooperate more, with the supplier extending more trade credit. Overall, results indicate OIO strengthens vertical relationships by alleviating holdup problems.

  • Presentations: Indiana University (2016); American Finance Association (Philadelphia, PA, 2018); Financial Management Association (Virtual meeting, 2020); Eastern Finance Association (Asheville, NC, 2023)

  • Media: Cited in BloombergView, November 30, 2016

  • Note: Circulated as “The Effects of Common Ownership on Customer-Supplier Relationships” until 2021.

Abstracts, etc. (working papers)

(Don’t) Feed the Mouth that Bites: Trade Credit Spillover Through Common Suppliers with Jie (Jack) He, Han Xia, and Liyan Yang

  • Abstract: Product market rivals often source upstream inputs from common suppliers, incentivizing strategic demands for trade credit to prevent the shared suppliers from providing liquidity to rivals – i.e., to avoid “feeding the mouth that bites.” We develop a model to illustrate that when government policies strengthen certain customers’ competitiveness, such strategic incentives become aggravated, leading to a spillover effect of these policies. We test the model predictions using manually collected pair-level trade credit data, and show that customers extract trade credit from common suppliers in an effort to divert these suppliers’ liquidity from rivals already benefiting from government policies.

  • Presentations: University of Georgia, University of Alabama, Louisiana State University, Ryerson University, University of Southampton, Financial Management Association (Atlanta, GA, 2022), Midwest Finance Association (Chicago, IL, 2023), CICF (Shanghai, CN, 2023), European Finance Association (Amsterdam, NL, 2023), Northern Finance Association (Toronto, CA, 2023), Eastern Finance Association (St. Petersburg, FL, 2024), American Economic Association (San Francisco, CA, 2025)

Trust in Cultural Institutions and Interfirm Cooperation: Evidence from Religious Scandals, with Quentin Dupont​

  • Revise and Resubmit, Journal of Financial and Quantitative Analysis

  • Abstract: We study how trust in cultural institutions affects cooperation between firms, employing local religious scandals for identification. We focus on trade credit as a trust-intensive aspect of supply chain relationships. In a triple-difference estimation, we find that firms located in scandal areas where the affected religion is prominent reduce trade credit to customers (relative to sales) by 5 percentage points. Consistent with the scandal damaging local norms of cooperation, results are stronger in relationships with limited history, greater geographic barriers, or transaction complexity. A public good game experiment further supports this mechanism, with treated participants anticipating reduced cooperation from others.

  • Presentations: University of Georgia (April 2023), Georgetown University (May 2023), Western Economic Association International (June 2023), Baylor University (September 2023), Financial Management Association (Chicago, 2023), Eastern Finance Association (St. Petersburg, FL, 2024), Southern Finance Association (Palm Beach Springs, FL, 2024)

 

 

 

 

One Sows and Another Reaps: Outsourcing Innovation to Suppliers (solo)

  • Abstract: While we know the innovation of supply chain partners can be complementary, I document novel evidence of a substitutionary relationship: Exploiting variation in upstream firms’ effective cost of R&D around the introduction of state-level R&D tax credits, I find customers strategically outsource innovative investment upstream when their suppliers’ R&D becomes effectively cheaper. Subsequently, customers produce patents that are more innovative, more similar to their suppliers’ expertise, and that garner more forward citations. Customers' patents more frequently name inventors previously named in upstream patents. Overall, results indicate firms can outsource their innovative expenditures upstream, while still reaping the innovative outputs.

  • Presentations: University of Georgia, Financial Management Association (Grapevine, TX, 2024), Eastern Finance Association (Philadelphia, PA, 2025), Southern Finance Association (Orland, FL, 2025, scheduled) 

When Push Comes to Shove: Selective Trade Credit Generosity in a Global Pandemic (solo)​

  • Abstract: The pattern of trade credit smoothing financial frictions may not hold in times of widespread economic disruption. Using novel quarterly-level data of receivable balances with major customers, I analyze trade credit outcomes at the onset of the COVID-19 pandemic for firms' public, private, and government buyers. While upstream firms extended credit terms toward all customers on average, this aggregation masks considerable cross-sectional variation: Credit extensions overwhelmingly went to large, publicly traded customers with presumably better access to capital. Firms extended terms with these customers by around 20 days, while privately held customers experienced a contraction of credit days of similar magnitude. Cross-sectional tests reveal suppliers consistently extended more credit to customers with better product market position and lower risk. The pattern is not driven by customer financial constraints or variation in downstream demand shocks. Instead, suppliers strategically extended credit to customers with greater downstream stability, resulting in subsequent sales growth, better customer retention, and higher profit margins.

  • Presentations: University of Georgia (April 2025)

The Hidden Risk of a Safe Customer: Regulatory Fragmentation and Government Contracting with Jon Kalodimos

  • Abstract: We examine how regulatory fragmentation affects the capital structure decisions of government suppliers. Using text-based measures of regulatory structure and a novel text-based measure of government procurement exposure, we find that suppliers respond to greater fragmentation by adopting more conservative capital structures, reducing leverage and increasing cash holdings. Our evidence supports a risk-based precautionary channel rather than an expectations-driven motive. The conservative response is strongest among firms with high procurement exposure and those making relationship-specific investments with limited redeployability, including R&D and differentiated products. The effect diminishes for long-tenured government suppliers who have accumulated regulatory expertise and reputational capital. We introduce a novel procurement exposure measure that captures firms' exposure to government contracting processes independent of contract value, addressing limitations of traditional disclosure-based approaches. Our findings reveal that regulatory fragmentation creates a distinct risk channel for government contractors that operates through the increased probability of contract disputes and relationship termination, offsetting the cash flow benefits typically associated with government customer relationships.

  • Presentations: University of Georgia (September 2025)

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