Contractual imperfections and the impact of crises on trade: Evidence from industry-level data

Castellares, Renzo; Salas, Jorge

doi:10.1016/j.jinteco.2018.09.004

Cited by 4 publications

(4 citation statements)

References 57 publications

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“…Modeling studies have shown that increases in inventory and CCC may decrease firms' profits (Menezes et al, 2021). Castellares and Salas (2019) found that industries characterized by a lengthier CCC tend to be more financially reliant and experience a substantial decline in sales during economic downturns.…”

Section: The Negative Relationship Of CCC On Profitabilitymentioning

confidence: 99%

Effect of Cash Conversion Cycle on Company Profitability: A Study on Indonesian Food and Beverage Listed Companies

Oktavianus Yusan,

Edy Handoyo

2023

IJMSA

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The Indonesian Food and Beverage industry is a dynamic and pivotal sector in the Indonesian business ecosystem, contributing significantly to the nation's economic growth and reflecting its cultural diversity. This paper delves into the relationship between the Cash Conversion Cycle and the profitability of Indonesian Food and Beverage listed companies. By examining this intricate connection, the study aims to provide valuable insights for financial managers, policymakers, investors, and researchers within this sector. This study used panel data regression with a purposive sampling method with a total of 687 samples that spans from 2007 until 2022. Data processing in this study uses Eviews 9. The research adopts Gross Profitability as a precise measure closely linked to working capital management and tests hypotheses related to the Cash Conversion Cycle components, including Days of Inventory Outstanding, Days of Sales Outstanding, and Days of Payable Outstanding. The findings reveal that Days of Sales Outstanding significantly and negatively impacts Gross Profitability, emphasizing the importance of efficient accounts receivable collection for profitability. Days of Inventory Outstanding, while marginally significant, also shows a negative association with Gross Profitability. In contrast, Days of Payable Outstanding does not exhibit statistical significance in explaining variations in Gross Profitability. These insights provide valuable guidance for managers in optimizing working capital management. Moreover, the paper recommends future research directions, including long-term analysis, industry-specific exploration, the influence of macroeconomic factors, comparative studies, and qualitative research to deepen our understanding of the Cash Conversion Cycle 's role in the Indonesian Food and Beverage industry and enhance financial management practices.

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Section: The Negative Relationship Of CCC On Profitabilitymentioning

confidence: 99%

Effect of Cash Conversion Cycle on Company Profitability: A Study on Indonesian Food and Beverage Listed Companies

Oktavianus Yusan,

Edy Handoyo

2023

IJMSA

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“…On the other hand, industries with high product technical complexity are prone to suffer more external uncertainties and risks [28,40], and institutional environments with low financial development level could drastically obstruct enterprises from adjusting their factor input structures to deal with the external risks. Moreover, those industries usually belong to capital-intensive and technology-intensive industries, which have a long return cycle of investments and a high dependence on a favorable financial environment.…”

Section: Research Hypothesesmentioning

confidence: 99%

“…After inspecting the relation between this institutional feature and firm exports, they conclude that firms with political connections could achieve comparative advantages in contract-intensive and financially-dependent industries, while political connections also exert a negative effect on firm exports, due to the problem of managerial inefficiency. Castellares and Salas [28] investigate the relation between the institution and trade for importing countries, and demonstrate that an adverse shock for an importing country leads to a disproportional decline in imports in industries with high degree of contractual vulnerability. Huber [29] examines that the variation in trade pattern affects institutional quality by using data on disaggregated bilateral trade flows around the world.…”

Section: Introductionmentioning

confidence: 99%

Institutional Quality and Sustainable Development of Industries’ Exports: Evidence from China

Yan

2018

Sustainability

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The knowledge about the relations between domestic institutional quality and the sustainable development of exports in emerging markets remains limited, since most research into the relations between the institutional environment and the sustainable development of exports has been conducted in developed market economies, especially in those of North America and Europe. With dynamic changes in the institutional environment of emerging countries over the years, this paper provides a novel perspective for investigating the relations above. This is the first paper to investigate the impact of institutional quality on the sustainable development of industries' exports in emerging countries from a comprehensive perspective of multiple institutional environments and multi-dimensional industries' heterogeneity. On the basis of defining institutional quality and industry heterogeneity, this paper explores the underlying mechanisms of institutional quality affecting sustainable development of industries' exports and conducts empirical analyses by using the data from China's 20 industries' exports to 117 countries for the period of 1996-2011. The results show that: (a) Industries with higher degrees of financial dependence or higher product technical complexities have export comparative advantages in better financial environments; (b) Industries with higher research and development (R&D) intensity or a higher concentration of intermediate inputs have export comparative advantages in better legal environments; (c) The differences in the level of financial development or in the efficiency of legal system would influence the effects of interactions between institutional quality and industry heterogeneity on the sustainable development of industries' exports. The present paper provides new evidence that institutional quality does promote the sustainable development of industries' exports in emerging countries. These results indicate that exports of heterogeneous industries in emerging economies are an adaptive response to the specific institutional environment, as well as a continuous release of institutional dividends with the improvement of the institutional environment.

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“…Previous studies constructed economic networks [10][11][12][13][14][15] based on statistical data (like input-output tables [1,[16][17][18], international trading data [19][20][21], and industrial development indexes) and independently detected industries' characteristics. Other studies considered the whole industrial chain that is formed by some industries [22][23][24][25][26][27][28][29][30][31].…”

mentioning

confidence: 99%

Detecting the nation-based characteristics of industries in the global input-output network of networks

An¹,

Wu²,

Xiang-yun³

et al. 2021

EPL

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Under the influence of national policies, development plans, and subsidies, industries from the same nation perform similarly and inherit a part of their nations' characteristics. Unlike the one-layer input-output network that treats industries as isolated, our model treats industries from the same nation as a relative tight community. Thus, the characteristics of industries are inherited from their nation, which is defined as the nation-based characteristics. To accurately account for the nation-based contributions of each industry, we construct a global input-output NoN (network of networks) model. The global input-output NoN is transformed from the international input-output tables based on hypermatrices and the network of networks model. Based on the global input-output NoN, we propose six nation-based indexes to assess different aspects of industries' nation-based contributions. Our network model and nation-based indexes are applied on the international input-output tables from 2010 to 2015. We confirm the applicability of our model and discover several interesting findings. Overall, the most important one is that some nonmanufacturing industries (e.g., health, education, and public administration) may be more critical than some significant manufacturing industries.

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Contractual imperfections and the impact of crises on trade: Evidence from industry-level data

Abstract: Los puntos de vista expresados en este documento de trabajo corresponden a los autores y no reflejan necesariamente la posición del Banco Central de Reserva del Perú.

Cited by 4 publications

References 57 publications

Effect of Cash Conversion Cycle on Company Profitability: A Study on Indonesian Food and Beverage Listed Companies

Effect of Cash Conversion Cycle on Company Profitability: A Study on Indonesian Food and Beverage Listed Companies

Institutional Quality and Sustainable Development of Industries’ Exports: Evidence from China

Detecting the nation-based characteristics of industries in the global input-output network of networks

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