Liquidity and the Performance of the Nigerian Manufacturing Firms: an Economic Value-added Approach

Abstract

Considering the possibility of finding a gap and a room for improvement, so much have been written about liquidity and performance. Notwithstanding, the emphasis has been on profitability as a yardstick for performance and little has been done on other areas of performance measurement. The emphasis has also been more on various economic sectors with the exception of the manufacturing industry. This paper intends to look at the impact, if any, of liquidity provision and availability on Nigeria’s manufacturing firm’s performance from the perspective of Economic Value Added (EVA). Economic value-adding is beyond just profitability or liquidity. The firm's value to the stakeholders, its sustainability and long-term values are defined. The study would apply liquidity theories, profitability and the economic value-added theories as it applies to a manufacturing firm in a developing economy like Nigeria. On its methodology, the article data is obtained from the World Bank’s World Development Indicators-WDI and then a regression analysis will be run on the data using the SPSS software and then an analysis of the results of the regression. The last section of the article would conclude and make recommendations from the study outcome and the empirical analysis with respect to the theories.

Medición de los factores que determinan la creación de valor en los sectores económicos colombianos: periodo 2016-2020

“…El enfoque del EVA es determinar las ganancias que están por encima del costo de capital requerido para los accionistas y otros proveedores de fondos (Osho et al, 2020), midiendo la capacidad de la empresa para obtener beneficios económicos que exceden la "renta" que dicha empresa paga por el uso de los recursos empleados por los propietarios y prestamistas (Priester & Wang, 2010). El EVA es una medida que se basa en la creación de valor que se supone deben generar los negocios, lo cual permite aumentar el capital de los accionistas en el largo plazo (Priyanka & Sudha, 2020).…”