 Stochastic frontier modelling of working capital efficiency across EuropeGodfred Adjapong Afrifa, Ishmael Tingbani and Oluseyi Oluseun Adesina Technological Forecasting and Social Change, 2022, vol. 184, issue C Abstract: This paper adopts the stochastic frontier analysis (SFA) to model working capital efficiency (WCE) on a sample of 6170 European firms from 2009 to 2018. We find: (i) larger firms are more efficient with their working capital management (WCM) than smaller firms, (ii) higher cash holding contributes to WCE, (iii) high competition is less conducive to WCE than low competition, (iv) export and sales growth potential decrease WCE and (v) WCE increases with access to bank credit. In the analysis, a distinction is made between the “old” EU countries and the “new” EU countries. The results are sensitive to the year of admission into the EU. The results are robust to omitted variable bias, using a more novel approach. Keywords: Working capital efficiency; Working capital management; Determinants of WCE; Inventory; Trade receivables; Trade payables; Stochastic frontier analysis (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:tefoso:v:184:y:2022:i:c:s0040162522005339 DOI: 10.1016/j.techfore.2022.122012 Access Statistics for this article Technological Forecasting and Social Change is currently edited by Fred Phillips More articles in Technological Forecasting and Social Change from Elsevier |
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