Credit Contract between Bank and Third-party Logistics Firm in Inventory Financing in China

Author

Peng Xu ; Hao Li ; Yong Wang ; Kai Rao

Author_Institution

Sch. of Manage., Southwest Univ. of Political Sci. & Law, Chongqing, China

fYear

2012

fDate

12-14 Oct. 2012

Firstpage

78

Lastpage

82

Abstract

In our study we apply the principal-agent model to study credit contract proposed by banks to motivate third-party logistics firms (TPL) and consider supervision as an important variable. Our results indicate that when supervision is introduced into contract, TPL can be motivated to work more efficiently. In particular, we give bank´ efficient supervision set and bank can be better off by keeping the supervision level within this set. Further, we give the optimal level of supervision.

Keywords

banking; contracts; credit transactions; financial management; logistics; China; bank; credit contract; inventory financing; principal-agent model; supervision level; third-party logistics firm; Contracts; Educational institutions; Fluctuations; Logistics; Materials; Monitoring; banks; incentive and supervision contract; inventory financing; risk management; small and medium-sized firms; third-party logistics firm;

fLanguage

English

Publisher

ieee

Conference_Titel

Business Computing and Global Informatization (BCGIN), 2012 Second International Conference on

Conference_Location

Shanghai

Print_ISBN

978-1-4673-4469-2

Type

conf

DOI

10.1109/BCGIN.2012.27

Filename

6382468