IMPACT OF HUMAN PERSPECTIVE OF INTELLECTUAL CAPITAL ON TRADE CREDIT WITH MODERATING ROLE OF PROFITABILITY IN PAKISTAN

Abstract

Purpose: This paper analyzes the impact that human capital has on trade credit in Pakistan's chemical sector. Human capital is a component of intellectual capital. Methodology: HC or Human Capital is taken as an independent variable. The dependent variable is trade credit. Trade credit has two types: Trade Credit Used (TCU) and trade credit extended (TCE). Other variables are also used, such as profitability (PROF), short-term bank credit (SBC), financial leverage (LEV). For empirical investigation, balanced panel data is used for the time 2010 to 2019. For obtaining econometric outcomes, we applied the static panel in E-views. Main Findings: The results indicate that short-term bank credit, leverage, and the interaction term of human capital and profitability create a positive impact with the used trade credit and TCE, while the impact of profitability and human credit on trade credit used is negative. Trade credit extended profitability is moderating the relationship of human capital and trade credit. Implications/Applications: This study has great importance for firm managers, policymakers, investors, academicians, and scholars in the selected sector of Pakistan. Novelty/Originality of this study: The study recommends the efficient, effective utilization of human capital and trade credit to gain a comparative advantage.