VERTICAL RELATIONS UNDER CREDIT CONSTRAINTS

• 成果类型: Article
• 署名作者: Nocke, Volker; Thanassoulis, John
• 署名单位: University of Mannheim; University of Warwick
• 刊物名称: JOURNAL OF THE EUROPEAN ECONOMIC ASSOCIATION
• ISSN/ISSBN: 1542-4766
• DOI: 10.1111/jeea.12067
• 发表日期: 2014
• 页码: 337-367
• 关键词: slotting allowances; limited-liability; private debt; INVESTMENT; RISK; integration; OWNERSHIP; BEHAVIOR; finance; CHOICE

摘要

We model the impact that credit constraints and market risk have on the vertical relationships between firms in the supply chain. Firms which might face credit constraints in future investments become endogenously risk averse when accumulating pledgable assets. In the short run, the optimal supply contract involves risk sharing, so inducing double marginalization. Credit constraints thus result in higher retail prices, and this is true whether the firm is debt or equity funded. Further, we offer a new theory of supplier finance arms as we show an intrinsic complementarity between supply and lending which reduces financing inefficiencies created by informational asymmetries. The model offers: a theory of countervailing power based on credit constraints; a transmission mechanism linking the cost of borrowing with retail prices; and a motive for outsourcing supply (or distribution) in the face of market risk.