Firm size and the interlinkages between sales volatility, exports, and financial stability of Pakistani manufacturing firms

Rashid, Abdul; Hassan, M. Kabir; Karamat, Hafsa

doi:10.1007/s40821-020-00162-w

Cited by 11 publications

(5 citation statements)

References 58 publications

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“…Morever, García-Vega et al (2012) analyze UK firms and emphasize the fact that firm having negative perceptions regarding their survival more intensively perceive tax-related and cultural export barriers. On the other hand, the result regarding the perception of bankruptcy, export cost and legislative differences by SMEs are not compatible with the results of Rashid et al (2021). This is because by analyzing Pakistani manufacturing firms, these researchers declare that firms having less bankrupcty concerns less likely to perceive export costs.…”

Section: Discussionmentioning

confidence: 71%

“…However, most of SMEs have limited resources, have lack of managerial and export experiences, and have high level of internal export barriers. Therefore, having less healthy financial conditions has been a major constraint for SMEs to do exporting activities, since it negatively influences their export decisions and probability to export (Rashid et al, 2021). Since export includes many expenses for SMEs, including sunk cost (Pascucci et al, 2021), fixed costs (Pietrovito & Pozzolo, 2021), and transport cost (Bianchi et al, 2018), firms having lower performance levels might perceive the export cost more intensively comparing to businesses having healthier financial conditions.…”

Section: Literature Reviewmentioning

confidence: 99%

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Financial performance and bankruptcy concerns of SMEs in their export decision

Ključnikov

Civelek

Krajčík

et al. 2022

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Research background: Due to having lack of financial power and low amount of revenues, most of SMEs? major concerns are bankruptcy and low financial performance. Those issues are risky situations for SMEs when making for their exporting activities. Therefore, depending on their performance and bankruptcy risk, they might more intensively perceive export barriers and this fact might determine their export decisions. Purpose of the article: This paper examines whether financial performance and bankruptcy concerns of SMEs affect their perceptions of export obstacles or not. Methods: This research performs random sampling method and directs an internet-mediated questionnaire to the selected respondents who are the executives of 408 Czech, Slovakian and Hungarian SMEs. To examine the influences of firm performance and bankruptcy on the perceptions of export impediments by SMEs, this paper employs Ordinal Logistic Regression Test. Findings & value added: The results show that SMEs having less healthy financial conditions less intensively perceive cultural-linguistic export barriers in comparison with SMEs having better financial performance. Moreover, firm performance is not a predictor variable in the perceptions of export costs, legislative and tax-related barriers by SMEs. On the other hand, while SMEs having more bankruptcy concerns more intensively perceive tax-related and cultural-linguistic barriers, bankruptcy concerns of SMEs do not influence their perceptions of export costs and legislative differences. Although many studies have investigated the impacts of financial conditions of SMEs on their internationalization and exporting decisions, they are isolated with only a market or only with a financial issue. The limited extents of those studies cause a partial investigation of export and financial issues of SMEs and make readers having a narrow perspective in this specific area. By focusing on various export obstacles and financial issues that SMEs face in different markets, this research offers a detailed understanding of SMEs? perceptions regarding their financial conditions and export barriers, from a comprehensive perspective. In this regard, this is the research gap that this paper aims to fill.

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Section: Discussionmentioning

confidence: 71%

Section: Literature Reviewmentioning

confidence: 99%

Financial performance and bankruptcy concerns of SMEs in their export decision

Ključnikov

Civelek

Krajčík

et al. 2022

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“…According to Rashid et al. (2021), high OL has a severe impact on a firm's solvency. Ryu (2021) claimed that firms which operate in a highly competitive product market have higher OL, while Taussig (2021) found that these firms earn higher stock returns.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Chen et al (2019) found that higher OL increases profitability, and Grau and Reig (2021) examined this influence on SMEs (Small and Medium-Sized Enterprises). According to Rashid et al (2021), high OL has a severe impact on a firm's solvency. Ryu (2021) claimed that firms which operate in a highly competitive product market have higher OL, while Taussig (2021) found that these firms earn higher stock returns.…”

Section: Literature Reviewmentioning

confidence: 99%

Market operating leverage and expected stock returns

Taussig

2022

J Corp Accounting Finance

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This article's main goal is to analyze the impact of market operating leverage (OL) on expected stock returns. While OL has been analyzed substantially in the literature, the analysis of an aggregate measure is new. The article begins with a cross-section analysis of 184,280 firm-year US firms, after which a former literature analysis is confirmed with current data. Next, an Aggregate Operating Leverage (AOL) is constructed. AOL predicts market returns both in and out of sample. Moreover, AOL significantly predicts the S&P500 Index, which is also of great consequence to practitioners.

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“…Similarly, Rashid (2014), Caglayan and Rashid (2014), Rashid (2016, Baum, Caglayan, and Rashid (2017), Chow, Muhammad, Bany-Ariffin, and Cheng (2018), Datta, Doan, and Iskandar-Datta (2019), Khan, Qin, and Jebran (2020), and Im, Kang, and Shon (2020) have also examine the link of the capital structure decisions of corporate firms with the level of uncertainty faced by firms. Some other empirical studies including Esposito (2017), Gervais (2018), and Rashid, Hassan, and Karamat (2020) found that the factor of uncertainty is one of significant determinants of firms' exporting decisions and exporting performance. Past studies have also examined and documented the significant effects of different types of uncertainty on firms' cash holding decisions (Akram, Rashid, & Anjum, 2019;Chakraborty, Baum, & Liu, 2016;Phan, Nguyen, Nguyen, & Hegde, 2019).…”

Section: Introductionmentioning

confidence: 99%

Accrual Management in the Pakistani Non-Financial Firms: Explaining the Role of Idiosyncratic Risk and Macroeconomic Uncertainty

Rashid¹,

Ishfaque²,

Jehan³

2021

LJB

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The growing global uncertainty has pushed firms to re-assess their financial strengths, and re-examine their earning management strategies and methods. It is now common knowledge that firms face unexpected variations in several different, firm-specific, and macroeconomic factors at a time. Therefore, this research sets out to examine the role of both idiosyncratic (firm-specific) risk and macroeconomic uncertainty in earnings (discretionary accrual) management, of 400 non-financial listed firms, over the time period spanning from the year 2000-2016. In this regard, this study offers robust empirical evidence that is based on the importance of both idiosyncratic and macroeconomic uncertainties, by considering various indicators of each type of uncertainty that is taken into account. The empirical findings state that there is a negative impact of both types of uncertainties on discretionary accruals. Notably, the findings reveal that compared to the impact of idiosyncratic risk, the uncertainty associated with macroeconomic factors tends to have greater impacts on accrual management of the Pakistani firms. These findings about the earning management effects of uncertainty are useful for different stakeholders including policymakers, customers, suppliers, investors and firm managers in order to formulate appropriate strategies and device relevant policies.

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Firm size and the interlinkages between sales volatility, exports, and financial stability of Pakistani manufacturing firms

Cited by 11 publications

References 58 publications

Financial performance and bankruptcy concerns of SMEs in their export decision

Financial performance and bankruptcy concerns of SMEs in their export decision

Market operating leverage and expected stock returns

Accrual Management in the Pakistani Non-Financial Firms: Explaining the Role of Idiosyncratic Risk and Macroeconomic Uncertainty

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