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Analyzing the Factors Determining the Financial Sustainability of Entrepreneurial Entities in Azerbaijan and Their Contribution to the Competitiveness of the National Economy

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  • Shams Aliyeva
  • Teyyub Aliyev

Abstract

The purpose of this article is to conduct a comprehensive analysis of the factors influencing the financial stability of entrepreneurial entities across multiple sectors of the economy in Azerbaijan, and their impact on the overall competitiveness of the national economy. The study employs a comprehensive econometric analysis to assess the contribution of internal factors (such as liquidity, innovation, and financial planning) and external factors (such as political stability, inflation, and exchange rate volatility) in a quantitative manner. The regression results indicate that innovation and liquidity are the most significant positive predictors of financial sustainability, while exchange rate volatility hurts it. The model provides strong empirical support for the findings, with 84% of the variability in financial sustainability explained. The results provide valuable insights into the strategic financial management practices that can enhance business resilience in a rapidly evolving economic landscape.

Suggested Citation

  • Shams Aliyeva & Teyyub Aliyev, 2025. "Analyzing the Factors Determining the Financial Sustainability of Entrepreneurial Entities in Azerbaijan and Their Contribution to the Competitiveness of the National Economy," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 5, pages 180-197.
    • Handle: RePEc:bas:econst:y:2025:i:5:p:180-197
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    File URL: http://archive.econ-studies.iki.bas.bg/2025/2025_05/2025_05_010.pdf
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    References listed on IDEAS

    as
    1. Arner,Douglas W., 2007. "Financial Stability, Economic Growth, and the Role of Law," Cambridge Books, Cambridge University Press, number 9780521870474, May.
    2. Edoardo Gaffeo & Lucio Gobbi, 2022. "Correction to: Achieving financial stability during a liquidity crisis: a multi‑objective approach," Risk Management, Palgrave Macmillan, vol. 24(1), pages 100-100, March.
    3. Rong Wang, 2024. "Safeguarding Enterprise Prosperity: An In-depth Analysis of Financial Management Strategies," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 17676-17704, December.
    4. Arner,Douglas W., 2007. "Financial Stability, Economic Growth, and the Role of Law," Cambridge Books, Cambridge University Press, number 9780521690560, May.
    5. Jalal Rajeh Hanaysha & Mohammed Emad Al-Shaikh & Shanmugan Joghee & Haitham M. Alzoubi, 2022. "Impact of Innovation Capabilities on Business Sustainability in Small and Medium Enterprises," FIIB Business Review, , vol. 11(1), pages 67-78, March.
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    More about this item

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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