Financial frictions and the ratio in UK manufacturing

Spaliara, Marina‐Eliza

doi:10.1016/j.econlet.2011.03.015

Cited by 4 publications

(2 citation statements)

References 11 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…The continued existence of financial constraints is also noted in Guariglia (1999) who modified the approach of Gertler and Gilchrist (1994) to establish that financially constrained and unconstrained samples exhibited distinct inventory investment behaviour. Size also seems to matter in determining firms' choice of capital intensity in times of financial constraint (Spaliara 2011). Other work (using the same data source as this paper) finds a correspondence between capacity constraints -indicating a lack of investment -and directly reported financial constraints (Kalckreuth 2006).…”

Section: Uk Studies Pre-crisissupporting

confidence: 53%

Financial constraints on investment: Effects of firm size and the financial crisis

Driver

Muñoz-Bugarin

2019

Research in International Business and Finance

View full text Add to dashboard Cite

We estimate the effect of external financial constraints on fixed investment intentions for UK manufacturing by size of firm distinguishing between normal effects and those since the financial crisis began in the UK in 2007. Our financial constraints data are constructed to reflect only supply-side influences i.e., they are independent of cyclical conditions that may affect the demand for credit. Using consistent quarterly long run survey data with IV estimation, we find that, only for the crisis period, are financial constraints important for large firms and then only for periods of falling business optimism. By contrast, small firms experienced continuous constraint but with no additional supply side effect during the crisis. A policy implication for the UK is that the key to resumed lending to SMEs may lie, not so much with bank behaviour as with the demand conditions that these firms face, in particular, the sustainability and certainty of demand.

show abstract

Section: Uk Studies Pre-crisissupporting

confidence: 53%

Financial constraints on investment: Effects of firm size and the financial crisis

Driver

Muñoz-Bugarin

2019

Research in International Business and Finance

View full text Add to dashboard Cite

show abstract

“…Profitability indicators are one of the most significant for evaluating the company's financial performance. Many authors at all times included profitability indicators in their research for evaluating the performance of companies (Iotti et al, 2024;Spaliara, 2011). However, it is not enough to evaluate the performance indicators to achieve the sustainability of the company.…”

Section: Corporate Performance Indicators and Esgmentioning

confidence: 99%

Determinants of Sustainability Performance of Manufacturing Companies Using Two-stage Data Envelopment Analysis

Sutiene,

Vaz,

Vaitiekuniene

2024

Preprint

View full text Add to dashboard Cite

The investigation of business performance through the lens of sustainability has become an increasingly attractive topic among scholars. This study contributes to the field by proposing a two-stage methodology. First, to assess companies' efficiency in terms of sustainability, the scores of the Environmental, Social and Governance (ESG) pillars are combined into the single weighted sustainability performance indicator using the 'Benefit of Doubt' (BoD) model, which is maximized for each company by comparing it against the best performers in terms of ESG scores based on Data Envelopment Analysis (DEA). Then, in the second stage, the significant determinants are identified after the efficiency estimates are regressed on the company performance indicators using Tobit panel regression. To demonstrate this approach, we selected 559 companies from the manufacturing sector, as this industry continues to face challenges in reducing environmental impact, improving resource efficiency, and fostering social responsibility. The main findings include the examination of top performers and underperforming companies in terms of sustainability, alongside key financial indicators identified in the study.

show abstract

Firm value adjustment speed through financial friction in the presence of earnings management and productivity growth: evidence from emerging economies

Khan,

Shoaib

2024

Humanit Soc Sci Commun

View full text Add to dashboard Cite

This study investigates the role of financial frictions on firm value within the framework of earnings management, including the impact of productivity growth. In contrast to prior studies, the present study employed an autoregressive model to examine the temporal dynamics of the variables to determine their short-term and long-term connection patterns. The results of the study indicate a negative association between financial frictions and firm value. Accrual earnings management, a practice employed by organizations to enhance their profit margins, serves as a mediator between financial frictions and firm value. This mediation of earnings management alleviates the adverse impact of financial frictions. The enhancement of productivity growth amplifies the conditional, indirect influence of earnings management. Moreover, this study reveals that financial frictions have a significant influence in the short-term, leading to overestimation of factor loadings. However, this impact stabilizes over time in the long run. Financial market frictions have the most prominent impact on firm value compared to the other two forms of frictions, namely, macroeconomic frictions and microeconomic frictions. Larger firms are more inclined to attain higher firm value than smaller enterprises. Managers can enhance firm value by exerting control over the influence of financial frictions in the economy through earnings management. The effectiveness of this strategy is contingent upon the level of productivity growth.

show abstract

Financial frictions and the ratio in UK manufacturing

Cited by 4 publications

References 11 publications

Financial constraints on investment: Effects of firm size and the financial crisis

Financial constraints on investment: Effects of firm size and the financial crisis

Determinants of Sustainability Performance of Manufacturing Companies Using Two-stage Data Envelopment Analysis

Firm value adjustment speed through financial friction in the presence of earnings management and productivity growth: evidence from emerging economies

Contact Info

Product

Resources

About