We show that production networks are important for the transmission of unconventional monetary policy. Firms with bonds eligible for purchase under the European Central Bank’s Corporate Sector Purchase Program act as financial intermediaries by extending more trade credit to their customers....

We study how production networks adapt when natural disasters affect the reliability of a firm in the network. Affected firms extend more trade credit to their customers, especially if these customers are important and would be difficult to replace. The suppliers of affected firms appear to...

Using information on about 10 million inter-firm transactions, we provide evidence that suppliers offer cheap trade credit to ease competition in downstream markets. We show theoretically that suppliers that have to transfer surplus to high-bargaining-power customers would want to offer an...