Working Capital Management, the Credit Crisis, and Hedging Strategies: Canadian Evidence

Kieschnick, Robert L.; Rotenberg, Wendy

doi:10.1111/jifm.12049

Cited by 8 publications

(8 citation statements)

References 44 publications

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“…impact on supply/demand/infrastructure) (Choi, 2020;Ivanov, 2020), the strategy of keeping a low working capital is questionable. According to Kieschnick and Rotenberg (2016), WCM literature has largely ignored the association between working capital and firm performance in light of supply chain disruption even though anecdotal data suggests that it is the first to be affected by economic downturns, such as the COVID-19 crisis. Therefore, our motivation is to explore the effect of working capital on the financial performance in light of COVID-19 disruption and answer the research question: RQ2.…”

Section: Ijppm 734mentioning

confidence: 99%

Working capital and firm performance: role of COVID-19 disruption

Pant¹,

Rathore

Dadsena

et al. 2023

IJPPM

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PurposeThis study examines the performance effect of working capital for a large sample of Indian manufacturing firms in light of supply chain disruption, i.e. the COVID-19 pandemic.Design/methodology/approachThis study is based on secondary data collected from the Prowess database on Indian manufacturing firms listed on the Bombay Stock Exchange (BSE) 500. Panel data regression analyses are used to estimate all models. Moreover, this study has employed robust standard errors to consider for heteroscedasticity concerns.FindingsThe results challenge the current notion of working capital investment and reveal that higher working capital has a positive and significant impact on firm performance. Further, it highlights that Indian manufacturing firms suffered financially post-COVID-19 as they significantly lack the working capital to run day-to-day operations.Originality/valueThis research contributes to the scant literature by examining the association between working capital financing and firm performance in light of the COVID-19 pandemic, representing typical developing economies like India.

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Section: Ijppm 734mentioning

confidence: 99%

Working capital and firm performance: role of COVID-19 disruption

Pant¹,

Rathore

Dadsena

et al. 2023

IJPPM

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“…The availability of bank credit is another variable that affects the working capital management strategies considerably and which is different among firms in terms of their dependencies on bank funding (Chen and Kieschnick 2018). Sales expectations, financial limitations and bankruptcy risks (Kieschnick et al 2013), hedging strategies (Kieschnick and Rotenberg 2016), and inventory strategies (Luo and Shang 2019) are other factors that may impact the WC. Financial constraints are often represented by investment-cash flow sensitivities (Riaz et al 2016).…”

Section: Working Capital Management Policiesmentioning

confidence: 99%

Bibliometric Analysis for Working Capital: Identifying Gaps, Co-Authorships and Insights from a Literature Survey

Martinho

2021

IJFS

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From a financial perspective, working capital represents the liquidity of firms that makes them able to deal with short-term liabilities in current assets (inventories, receivables accounts, and net financial resources). However, this concept is also considered in scientific literature as, among other meanings, stock of productive capital, or variables costs. Considering the importance of working capital in a firms’ dynamics, the principal objective of this study is to highlight the main gaps and insights in literature concerning working capital and to suggest future research. For this purpose, bibliometric analysis was carried out through bibliographic information from both the Web of Science Core Collection and from the Scopus for the topic of “working capital”. These data were first worked through bibliometric approaches, considering the VOSviewer and Gephi software and later surveyed through a literature review. As the main insights, it is worth highlighting that there are several gaps in related literature, where the most worrying is the weak reference to sustainability or sustainable development concepts. Finally, the majority of the networked research was focused on just a few authors, organizations, and countries.

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“…Al mismo tiempo, de acuerdo con Clark y Judge ( 2008), es conveniente utilizar otras variables que pueden ser sintomáticas de la situación financiera de la empresa como, por ejemplo, aquellas relativas a la cobertura de intereses generados por la deuda y a la capacidad para su devolución. Además, la existencia de recursos en la empresa puede minorar la necesidad de aplicar cobertura porque esta riqueza ya reduce per se la probabilidad de insolvencia (Kieschnick y Rotenberg, 2015;Muller y Verschoor, 2006;Allayannis et al, 2012). En consecuencia, la disponibilidad de un volumen importante de activos líquidos, valor de mercado y/o una elevada rentabilidad favorecen que la empresa no quiebre.…”

Section: Metodología Y Variablesunclassified

Análisis De La Exposición Económica Al Riesgo Cambiario en El Mercado Español

Búa

Lado-Sestayo

2017

GCG

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Este trabajo analiza el nivel de exposición económica al tipo de cambio y sus determinantes en el mercado español, considerando seis divisas de referencia respecto al euro: el dólar estadounidense, el yuan chino, el franco suizo, la libra esterlina, la corona noruega y el rublo ruso. Ello es relevante porque la volatilidad cambiaria puede tener un impacto directo sobre las operaciones de la empresa en el corto plazo y, en un horizonte temporal mayor, sobre su valor. Los resultados obtenidos en esta investigación confirman que la mayoría de empresas analizadas tienen un perfil exportador en su exposición económica, esto es, se benefician de depreciaciones del euro frente a otras divisas, especialmente, la libra esterlina. Por el contrario, respecto al franco suizo, predominan los importadores netos. Asimismo, sus determinantes difieren entre exportadores e importadores, si bien, en ambos casos, la diversificación geográfica actúa como cobertura operativa.

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Working Capital Management, the Credit Crisis, and Hedging Strategies: Canadian Evidence

Cited by 8 publications

References 44 publications

Working capital and firm performance: role of COVID-19 disruption

Working capital and firm performance: role of COVID-19 disruption

Bibliometric Analysis for Working Capital: Identifying Gaps, Co-Authorships and Insights from a Literature Survey

Análisis De La Exposición Económica Al Riesgo Cambiario en El Mercado Español

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