Determinants of Financial Sustainability in Chinese Firms: A Quantile Regression Approach

Zhao, Li; Liu, Zhengqiao; Vuong, Thi Huong Giang; Nguyen, Huu Manh; Radu, Florin; Tăbîrcă, Alina Iuliana; Wu, Yang-Che

doi:10.3390/su14031555

Cited by 12 publications

(14 citation statements)

References 49 publications

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“…Furthermore, as described by the authors ( 58 – 60 ), it is best to use bootstrapping as an effective robust resampling technique to obtain healthy estimated results when the sample in the empirical model using quantile regression is small. In a recent study, academics have used QR as an available bootstrap method in statistical analysis software, such as STATA ( 61 ). These are standard methods for estimating the asymptotic covariance matrix of coefficients ( 62 ).…”

Section: Methodsmentioning

confidence: 99%

COVID-19 Shock, Financial Flexibility, and Hotels' Performance Nexus

Zhang

Chang

2022

Front. Public Health

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This study investigates the nexus of coronavirus disease 2019 (COVID-19) shock, financial flexibility (FF), and firm performance (FP) in Taiwan listed hotel firms. Quantile regression (QR) methods were used to analyze the data from Taiwan Stock Exchange listed hotel firms between 2020 Q1 and 2021 Q2. The results evidence that there is an inversed U-shaped linkage between FF and FP for the hotel industry. Additionally, FF has an inverted U-shaped effect on FP for the asset-light hotel firms for all quantiles except the 50th quantile. In addition, FF also has an inverted U-shaped impact on FP for the asset-heavy hotel firms in the 10th and 90th quantiles. A significant finding in this study is that there is a concave non-linear relationship between FF and FP, consistent with the law of diminishing marginal return. That is, with an increase in FF, the FP is on the rise; when FF exceeds the inflection point level, the FP begins to decline. Thus, a firm must ensure that the FF strategy it adopts must be the most efficient and effective, i.e., it must bring the trade-off between costs and benefits. The empirical results highlight the need for the hotel industry of Taiwan to take the rolling adjustment and optimization of FF after the COVID-19 pandemic for long-term sustainability.

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Section: Methodsmentioning

confidence: 99%

COVID-19 Shock, Financial Flexibility, and Hotels' Performance Nexus

Zhang

Chang

2022

Front. Public Health

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“…In an empirical study of the dependence of the objective function on variables, formalized economic and mathematical methods of analysis using linear regression were applied with least squares testing for the significance of the model, then tests for redundancy of insignificant variables (Wald's test), Ramsey's test for the functionality of the model, White's test and Breusch-Pagan for heteroscedasticity (heterogeneity of observations), and multicollinearity by the method of inflation factors [15]. The formalization of the equation was carried out using the specialized statistical package, Gretl.…”

Section: Methodsmentioning

confidence: 99%

Banking Sector Profitability: Does Household Income Matter?

2022

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Household incomes, their level and dynamics are one of the factors that ensure the achievement of the Sustainable Development Goals. At the same time, stable development of the banking sector, which is impossible without steady earnings, determines economic growth, which also positively affects reaching the Sustainable Development Goals. The paper examines the impact of household income on the return on assets of the banking sector in Russia using annual time series from 2003 to 2019. The study was conducted using formalized economic and mathematical methods of analysis by linear regression with least squares tests on the significance of the model, with tests for redundancy of insignificant variables (Wald test), Ramsey test on the functionality of the model, White and Breusch Pagan test for heteroscedasticity (heterogeneity of observations) and multicollinearity by method of inflation factors, graphic method. The Multiple Linear Regression (MLR) model was used. The results show that (1) an increase in the growth rate of household income and deposits in the non-financial sector has a positive effect on the return on assets of the banking sector; (2) an increase in the growth rate of the price of Brent crude oil and non-performing loans negatively affect the dependent variable; and (3) the regions that have the greatest (positive and negative) impact on profitability of whole bank sector in Russia were identified. Increasing household incomes and eliminating inequality in the incomes of the population of different regions will have a positive impact not only on social well-being but will also provide the banking sector with the opportunity for profitable operation and create conditions for sustainable growth. Our conclusions are useful for the regulator and individual banks and can be taken into account when developing and implementing policies aimed at sustainable development.

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“…Myers (1984) stated that company will consider trading off the tax shield aid of debts finances with the cost of debt and financial distress for creating an optimal financing structure with increased firm value. Zhao et al (2022) proved that trade-off is applicable to support diverse leverage levels for sustainability perspective. According to K. Q.…”

Section: Literature Reviewmentioning

confidence: 99%

“…H 3 : There is a significant causality of multiple debt finances on the net profit margin of nonfinancial companies in the diplomatic developing ties. Zhao et al (2022) applied conditional quantile regression statistics and determined the sustainability effects of financing structure distribution of Chinese listed companies for period 2010-2019. The findings revealed significant negative causality between high leverage levels and profitability.…”

Section: Financial Companies In the Diplomatic Developing Tiesmentioning

confidence: 99%

Multiple Debt Finances and GRI Sustainability: Firm Level Evidence from the Diplomatic Developing Ties

Saleem¹,

Hashmi²

2022

j.financ.econ.res

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Sustainability performance has become critical to every industry. The study examines the effect of Multiple debt finances on financial performance and GRI sustainability economic performance, measured through GRI 201-1, economic performance approach, for period from 2007-2020. The study applied mixed panel regression models to analyse the sample of 253 non-financial firms from diplomatic developing ties, namely Pakistan and India. The empirical findings shows that short-run debts have significant positive, but long-term and total debts have significant negative performance effects. However, firm size and asset tangibility have performance effects for non-financial firms of Pakistan and India. The study applied trade off theory for supporting the implication of GRI sustainability economic performance.

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Determinants of Financial Sustainability in Chinese Firms: A Quantile Regression Approach

Cited by 12 publications

References 49 publications

COVID-19 Shock, Financial Flexibility, and Hotels' Performance Nexus

COVID-19 Shock, Financial Flexibility, and Hotels' Performance Nexus

Banking Sector Profitability: Does Household Income Matter?

Multiple Debt Finances and GRI Sustainability: Firm Level Evidence from the Diplomatic Developing Ties

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