TITLE:
Impact of Firm Power on Debt Structure, Bank Loan Financing and Corporate Performance in China
AUTHORS:
Nicolas Diodji Mamadou Faye, El Hadji Omar Ndao, Kokou W. Tozo, Mouanda Gilhaimé, Mohammed Abdul-Latif
KEYWORDS:
Company Value Chain Power, Industry Chain, Financial Liabilities, Bank Loan Financing, Firm Performance
JOURNAL NAME:
Technology and Investment,
Vol.14 No.2,
May
19,
2023
ABSTRACT: This paper examines the incidence of firm value chain power on its exterior
financing liabilities, bank loan financing and firm performance. Taking data
from the China Stock Market and Accounting Research (CSMAR), this study has
gathered cross-sectional data of 13,653 firms from 2006 to 2016. The results
indicate that industries with higher power in the value chain carry a lower
volume of financing liabilities. The results also show that companies with
greater firm power use lower financing liabilities and aim to utilize non-cost
commercial credit for financing. The study also reveals that creditors from the
banks sector give more hand to large firms, and the role of firm power has
merely been accepted
by banks in big-scale and constant companies. Additionally, firm power has no
considerable impact on the maturity of bank loans. After last, this study
moreover unveils the economic outcomes of the effect of firm value chain power
across the differences in firm financial performance. Low-scale, great-growth
firms with bigger firm power get best financial performance.