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Working Capital Management in Czech SMEs: An Econometric Approach

Author

Listed:
  • Erginbay UGURLU

    () (Hitit Universitesi, FEAS, Department of Economics)

  • Irena JINDRICHOVSKA
  • Dana KUBICKOVA

Abstract

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
    as

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    File URL: http://icesba.eu/RePEc/icb/wpaper/ICESBA2014_38UGURLU_P311-317.pdf
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    References listed on IDEAS

    as
    1. Irena Jindrichovska & Erginbay Ugurlu & Dana Kubickova, 2013. "Changes in Capital Structure of Czech SMEs: A Dynamic Panel Data Approach," Ekonomika a Management, University of Economics, Prague, vol. 2013(3), pages 6-26.
    2. 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.
    3. Christopher F Baum, 2001. "Residual diagnostics for cross-section time series regression models," Stata Journal, StataCorp LP, vol. 1(1), pages 101-104, November.
    4. Irena Jindrichovska, 2013. "Financial Management in SMEs," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 79-96.
    5. repec:ers:journl:v:xvi:y:2013:i:sisme:p:79-96 is not listed on IDEAS
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    More about this item

    Keywords

    cash conversion cycle; profitability; SMEs; working capital management; panel data;

    JEL classification:

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

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