Abstract
Using the data of non-financial firms from India, the paper finds that firms with large advertising budget tend to receive more trade credit from their suppliers than firms with low advertising budget. The findings are consistent with the assumption that advertising reduces information asymmetries, builds brand image, and improves firm performance. All of these factors facilitate the access to trade credit. The findings of this paper hold after numerous sensitivity checks.
Appendix A: Definition of Variables
Variable | Definition | Source |
---|---|---|
TRADE |
|
Worldscope |
ADVERT |
|
Thomson reuters eikon |
SIZE | Natural logarithm of market capitalization | Worldscope |
LEVERAGE |
|
Worldscope |
EARNINGS |
|
Worldscope |
DIVIDENDS |
|
Worldscope |
BMR |
|
Worldscope |
ANALYST | Total number of analysts covering a firm | Thomson reuters eikon |
AUR |
|
Worldscope |
SALARY |
|
Worldscope |
CASH |
|
Worldscope |
BETA | Sensitivity of stock returns to market returns (based on the linear regression of the logarithmic adjusted returns and the returns of the corresponding market index – using previous five years of monthly data) | Datastream |
VOLATILITY | Standard deviation of stock returns | Datastream |
INTANGIBLES |
|
Worldscope |
YDUM | Set of year dummies | Worldscope |
IDUM | Set of industry dummies based on Industry Classification Benchmark (ICB) | Worldscope |
COVID |
|
Self-calculation |
CRISIS |
|
Self-calculation |
ADVERT (alternate definition) |
|
Thomson reuters eikon |
ADVERT (alternate definition) |
|
Thomson reuters eikon |
TRADE (alternate definition) |
|
Worldscope |
TRADE (alternate definition) |
|
Worldscope |
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Articles in the same Issue
- Frontmatter
- Reduction of Ivory Product Purchase in China: The Role of Cultural Values on Ethical Consumption
- The Prospection and Retrospection of Experiential Purchases as More Meaningful Memories: Social and Affective Implications
- “How Brands Can Influence Consumers’ Attitudes Towards Visiting Brand-related destinations”
- Consumer Behaviour on AI Applications for Services: Measuring the Impact of Value-Based Adoption Model on Luxurious AI Resorts’ Applications
- AI-Powered Augmented Reality App Satisfies My Beauty Needs and Want
- The 4Ps Marketing Strategy as a Driver of Dynamic Capabilities: Path to Consumer/Voter Satisfaction
- Authenticity as a Strategic Weapon: Navigating the Social Media Battlefield to Enhance Brand Loyalty
- Allurement of Augmented Reality on Behavioral Intention: Delineating the Role of Visual Appeal and Arousal Using Information System Success Model
- Don’t Tell Me to Have, but to Do It! The Role of Luxury Desirability Motives in Reducing Counterfeiting Schadenfreude
- “Gusto” or “Taste”? Anglicisms Change Perceived Product Risk and Product Appeal in Italian Print Advertising
- Does Advertising Facilitate Supplier-Provided Trade Credit?
- Understanding the Incongruent Brand Personalities on Social Media: Evidence from Indian Brands