Banking Relationships and the Formation of Supply-Chain Relationships

74 Pages Posted: 15 Mar 2019

See all articles by Gabriela Coiculescu

Gabriela Coiculescu

Yeshiva University - Syms School of Business

Date Written: December 31, 2018

Abstract

I study the effect of banking relationships on the formation of new supply-chain relationships. I find that common banking relationships between a firm and a potential supplier increase the probability that the potential supplier will be selected to start a new supply-chain relationship. The effect is driven by firms in low-innovation industries. However, when accounting for the endogeneity of supply-chain and banking relationships, using bank branch location as an instrument for common banking relationships, the effect of common banks is negative, suggesting that supply-chain partners avoid common lenders for fear that sensitive information might leak through the bank to the supply-chain partner.

JEL Classification: G20; G21; G30; D23; D57; L10; L14

Suggested Citation

Coiculescu, Gabriela, Banking Relationships and the Formation of Supply-Chain Relationships (December 31, 2018). Available at SSRN: https://ssrn.com/abstract=3341029 or http://dx.doi.org/10.2139/ssrn.3341029

Gabriela Coiculescu (Contact Author)

Yeshiva University - Syms School of Business ( email )

United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
64
Abstract Views
996
rank
432,081
PlumX Metrics