Behaviour of Trade Credit- Its Relevance for Monetary Policy

Behaviour of Trade Credit Its Relevance for Monetary Policy L M Bhole Trade credit is an important source of short-term finance for business units. We know almost nothing about the behaviour of trade credit and its relationship with monetary policy. We take up in this paper the task of presenting a comprehensive analysis of the volume, distribution and other characteristics of trade credit and of finding out how far it can undermine the effectiveness of monetary policy.