The aim of this paper is to review the impact of entrepreneurs' attitudes toward the defined business risks on the perception of the future of small and medium-sized enterprises (SMEs). 454 SMEs from the Czech Republic (CR) participated in the research and completed an online questionnaire. Structural equation modelling and factor analysis were used to identify the causal relationships between the examined variables. Entrepreneurs' attitudes toward business failure also have a positive effect on the future of the SME. The perception of financial risk in positive indicators of financial performance and the perception of financial risk as part of the company's everyday life have the most significant impact on future business. Operational risk is reflected in the utilisation of corporate resources, reducing customer complaints about the quality of the company's products and the company's independence of a limited number of suppliers. The company's sales volume adequacy provides a source of market risk. It has the third strongest positive impact on the future business in the SME segment. The research results provide a valuable platform for the authors of national and regional development strategic plans looking for SME support and development as well as the authors of the relevant policies.
This paper investigates the collective impact of financial literacy and inclusion on individuals' financial capability focusing on the mediating role of financial behaviour. The research is conducted on an individual-level survey. The relationships were examined by using PLS-SEM. Financial capability can be improved by increasing individuals' financial knowledge, financial behaviour and promoting their inclusion in financial services. Furthermore, the indirect effect of financial knowledge and attitude on financial capability is found to be significant, highlighting the importance of financial behaviour. The results assist policymakers and industry leaders in understanding the most influential factors on financial capability in the context of a post-communist transition country. This enables them to design policies and services aimed at equipping citizens with knowledge and skills to make best use of their financial resources.
Competitive advantage is the key to a company’s success, and the business strategy represents a long-term plan to achieve a competitive advantage by affecting the company’s financial behavior. This research studies the interaction of business strategy, competitive advantage, and financial strategy to explore whether companies choose different financial strategies based on their business strategies as well as what role competitive advantage plays in their decision-making. By building a composite index and observing maturity mismatched investment, this research quantifies the risk level of business strategies and financial strategies. Using text analysis of a company’s annual report, the research builds a dummy variable to measure the competitive advantage. Based on the samples of A-shares listed on the China Shanghai and Shenzhen stock exchanges from 2007 to 2016, the research shows that the risk level of business strategy and financial strategy tends to move in opposite directions. If a company embraces an aggressive business strategy, it is more likely to choose a conservative financial approach in terms of lower overall risks, but for the company with a competitive advantage, the negative correlation between these two strategies is weakened. Further analysis found that company ownership, free cash flow, and the quality of internal control also play a significant role in the interaction between business strategy and financial strategy. Our findings not only enrich research on business strategy and financial behavior, but also deepen the understanding of competitive advantage and corporate financial strategy theoretically.
People steal copper and other nonferrous metals to sell them to scrap yard. Simultaneously, prices at scrap yards are set by the world market. We argue that shocks in metal prices represent a quasi-experimental variation in gains from crime. This allows us to estimate the behavioral parameters of supply of offenses and test the economic theory of criminal behavior. Our estimates suggest that the long-term elasticity of supply of metal thefts with respect to the re-sale value of stolen metal is between unity and 1.5. Moreover, the system tends to equilibriate quickly-between 30 and 60 percent of a disequilibrium is corrected the following month and the monthly price elasticity estimates are around unity.
The People´s Republic of China is one of the largest, but also the most demanding markets in the world. The trade is limited by a number of barriers, strong competition and unusual environment for trades from other parts of the world. Despite those limitations, Czech exporters are able to establish themselves in the Chinese market, exporting mainly machines and vehicles. To predict future export trends is very difficult; however, these predictions can be crucial not only for individual exporters but also for the whole national economy. For predictions, economists use causal, intuitive or statistical methods. The objective of the contribution is to compare the accuracy of equalizing time series by means of regression analysis and artificial neural networks for a possible prediction of future export trends on the example of the Czech Republic export to the People´s Republic of China. For the purposes of analysis by means of statistical methods, the data obtained from monthly statements from the period starting from the year 2000 and ending in July 2018. First, a linear regression is carried out and subsequently, neural networks are used for regression. Finally, the results are compared. It appeared that in practice, mainly all retained neural networks are applicable. However, the first of them showed significant deviations within a very short period of time.
The reconstruction of buildings generally prolongs their useful life, increases their utility value, and last but not least, leads to an increase in their value. These assumptions only apply if an independent third party reaches the same conclusion together with the owner. However, the undesirable effect of the reconstruction of a building may be a decrease in its value. The aim of this contribution is to determine the change in value of an older sample building assessed in the included case study as a result of its reconstruction. Valuation methods are applied, which, as it turns out, reveal the inaccuracy of the subjective view of the person who reconstructed the building. The resulting change in the value of the sample building is discussed from the point of view of the applied valuation methods and other value-creating aspects (subjective view of the owner on the value of the building, historical value of the building, etc.). The contribution concludes with recommendations for maximizing the increase in value of a property through its reconstruction so as to eliminate the risk of a decrease in its value.
Companies listed on the stock market must devote a great deal of attention to their market position. They must increase their competitive advantage in the undeniably key process of the issuance of stocks. As the issuance of preferred stocks has increased after the last crisis and in the current period of low interest rates in Europe, they are becoming more favoured investment instruments, we decided to analyse the real properties of preferred stocks in Europe in order to increase the efficiency of joint-stock companies. Using a dataset comprising all companies having both common and preferred stocks issued and traded on European markets between 2009- 2016, we determined the relationship of risk (measured by beta coefficients) and price volatility among common and preferred stocks and bonds in Europe. Our findings show beta coefficients of preferred stocks as systematically lower than beta coefficients of common stocks. Considering a difference of up to 10% as negligible, however, preferred stocks showed a similar or higher beta coefficient than corresponding common stocks of the same company in 53% of cases, whereas for 33% of cases, the difference is only ±10%. Coefficients of variation in prices showed a similar relationship, with only a negligible portion of preferred stocks bearing fixed (stable) dividends. This result implies that currently traded preferred stocks in Europe in fact do not possess such characteristics they are typically said to have, and in many cases they incur as comparable a risk as do common stocks. This essential information should help to increase the efficiency and competitiveness of joint-stock companies.
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