Uncertainty in Working Capital Management and Firm Performance: A COVID-19 Perspective

International Journal of Economics and Management Pub Date : 2022-11-10 DOI:10.47836/ijeamsi.16.1.008

M. R. Hossain, M. Zariyawati

引用次数: 0

Abstract

This study examines the impact of the COVID-19 pandemic on firms' working capital management (WCM) and, eventually, firms’ performance of 4513 China and 1049 United Kingdom (UK) publicly listed firms. Static panel data analysis was used to achieve the objective of this study. By using the cash conversion cycle (CCC) as a proxy for WCM, we discover that COVID-19 has a negative effect on the WCM of Chinese firms. We also found a statistically significant negative relationship between WCM and Chinese firms’ performance. This suggests that when firms are affected by COVID-19 uncertainty, Chinese firms will be compelled to reduce their account receivables, inventory levels, and seek increased credit terms from suppliers. Contrary to Chinese firms, we discover the positive relationship between COVID-19 and WCM for UK firms. Further, the relationship between WCM and UK firms’ performance is positively associated. The greater investment in WCM by UK firms during the COVID-19 period generated a higher firm performance.

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营运资金管理与企业绩效的不确定性:新冠肺炎视角

本研究考察了COVID-19大流行对企业营运资本管理(WCM)的影响，并最终考察了4513家中国上市公司和1049家英国上市公司的业绩。采用静态面板数据分析达到本研究的目的。通过使用现金转换周期(CCC)作为WCM的代理，我们发现COVID-19对中国企业的WCM有负面影响。我们还发现WCM与中国企业绩效之间存在显著的负相关关系。这表明，当企业受到COVID-19不确定性的影响时，中国企业将被迫减少应收账款和库存水平，并寻求从供应商那里获得更高的信贷条件。与中国企业相反，我们发现英国企业的新冠肺炎与WCM呈正相关。此外，WCM与英国公司绩效之间存在正相关关系。2019冠状病毒病期间，英国企业在WCM方面的更多投资带来了更高的企业业绩。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

International Journal of Economics and Management Economics, Econometrics and Finance-Economics, Econometrics and Finance (all)

CiteScore

1.80

自引率

0.00%

发文量

期刊介绍： The journal focuses on economics and management issues. The main subjects for economics cover national macroeconomic issues, international economic issues, interactions of national and regional economies, microeconomics and macroeconomics policies. The journal also considers thought-leading substantive research in the finance discipline. The main subjects for management include management decisions, Small Medium Enterprises (SME) practices, corporate social policies, digital marketing strategies and strategic management. The journal emphasises empirical studies with practical applications; examinations of theoretical and methodological developments. The journal is committed to publishing the high quality articles from economics and management perspectives. It is a triannual journal published in April, August and December and all articles submitted are in English. IJEM follows a double-blind peer-review process, whereby authors do not know reviewers and vice versa. Peer review is fundamental to the scientific publication process and the dissemination of sound science.