Comment: An Economic Model of Trade Credit

Abstract

Professor Schwartz's [6] attempt to provide an economic model of trade credit is to be applauded. I am in complete accord with his statement [6, p. 656] that “the aggregate importance of trade credit and the economic effects generated by changes in trade credit flows suggest that greater attention should be given to this source of funds.” For too long, thorough qualitative and quantitative analyses applied to the phenomenon of trade credit have been somewhat neglected. In his attempt to remedy this situation, Schwartz is to be complimented.