Credit risk contagion in complex companies network–Empirical research based on listed agricultural companies

Abstract

This study investigates credit risk contagion among listed agricultural companies using data from China's A-share market from 2002 to 2021, examining credit risk contagion mechanisms in the supply chain, investment, and information networks. Furthermore, we examine the moderating effect of network structure on credit risk contagion within networks. The results show that credit risk in the supply chain network has the greatest contagion effect, followed by investment and information networks. Credit risk is mainly transmitted through the capital path, product path, and information path. The network structure plays a crucial role in facilitating the contagion process. State-owned companies and companies with high customer concentration have higher risk resistance capacity. Research also shows a one-year time effect, indicating that the impact of credit risk contagion decreases over time. Finally, this study proposes suggestions for financial institutions, companies, and governments to enhance the risk-resisting abilities of the agricultural industry.