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Working Capital Management in Czech SMEs: An Econometric Approach


  • Erginbay UGURLU

    (Hitit Universitesi, FEAS, Department of Economics)



In this paper we investigate the relationship of working capital management and corporate profitability on a sample of Czech small and medium firms. Capital structure and working capital management are two areas widely investigated by economic researchers in order to investigate forces determining profitability of firms. We use an initial sample of 3053 Czech SMEs for the period of 2009-2012 and we employ the panel data methodology to find whether there is the statically significant relationship between profitability and components of working capital – mainly inventories, receivables and payables and other variables based on the previous literature.

Suggested Citation

  • Erginbay UGURLU & Irena JINDRICHOVSKA & Dana KUBICKOVA, 2014. "Working Capital Management in Czech SMEs: An Econometric Approach," International Conference on Economic Sciences and Business Administration, Spiru Haret University, vol. 1(1), pages 311-317, December.
  • Handle: RePEc:icb:wpaper:v:1:y:2014:i:1:311-317

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    References listed on IDEAS

    1. Irena Jindrichovska & Erginbay Ugurlu & Dana Kubickova, 2013. "Changes in Capital Structure of Czech SMEs: A Dynamic Panel Data Approach," Ekonomika a Management, Prague University of Economics and Business, vol. 2013(3), pages 6-26.
    2. Irena Jindřichovská & Pavel Körner, 2008. "Determinants of corporate financing decisions: a survey evidence from Czech firms," Working Papers IES 2008/01, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Jan 2008.
    3. Marc Deloof, 2003. "Does Working Capital Management Affect Profitability of Belgian Firms?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 30(3‐4), pages 573-588, April.
    4. Marc Deloof, 2003. "Does Working Capital Management Affect Profitability of Belgian Firms?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 30(3-4), pages 573-588.
    5. Christopher F Baum, 2001. "Residual diagnostics for cross-section time series regression models," Stata Journal, StataCorp LP, vol. 1(1), pages 101-104, November.
    6. Irena Jindrichovska, 2013. "Financial Management in SMEs," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 79-96.
    7. repec:ers:journl:v:xvi:y:2013:i:sisme:p:79-96 is not listed on IDEAS
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    Cited by:

    1. Sakınç, İlker, 2018. "A Comparison of Working Capital Components of Turkish And Indian Cement Firms," Bulletin of Economic Theory and Analysis, BETA Journals, vol. 3(4), pages 261-272, December.

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    More about this item


    cash conversion cycle; profitability; SMEs; working capital management; panel data;
    All these keywords.

    JEL classification:

    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods


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