Token, Aizat2021-06-282021-06-282021-06Token, A. (2021). Trade versus bank credit (Unpublished master`s thesis). Nazarbayev University, Nur-Sultan, Kazakhstanhttp://nur.nu.edu.kz/handle/123456789/5474This study analyzes the relationship between trade and bank credit, considering them as jointly determined variables. The relative sizes of bank and trade credit to sales are modeled in a two-equation system, allowing them to appear as explanatory variables in each other’s equations. Utilizing the administrative panel data consisting of large firms in Kazakhstan, I carry out my estimations employing the 2SLS method treating exclusion restrictions as instruments. Short-term financial investments are used as the exclusion restriction for the trade credit equation, whereas the size of intangible assets and cash-on-hand are utilized as exclusion restrictions for the bank loans equation. The results suggest a complementary relationship between trade and bank credit. Additional analysis during the 2014-15 economic crisis period points out to a decrease in the effect of the size of the labor cost on trade credit on the onset till the middle of the 2014-15 economic crisis. I also find that the effect of the size of fixed assets on bank loans weakened in 2015-16.enAttribution-NonCommercial-ShareAlike 3.0 United Statestradebank creditKazakhstanType of access: Open AccessMaster's thesis