Working Capital Management and Firm Listing Status
Multinational Finance Journal, 2012, vol. 16, issue 3-4, 261-301
This study comparatively examines the determinants of working capital management for listed vs. unlisted firms, and assesses the impact of this policy on profitability by focusing on the cash conversion cycle, a commonly used measure of working capital management. By using a large UK public and private firm sample, it is found that private firms have significantly lower cash conversion cycles than their public counterparts, and that traditional determinants of the cycle significantly differ between the two groups. The findings are robust to matching public and private firms according to a number of fundamental characteristics, allowing only for their listing status to differ. Results further indicate that the cash conversion cycle has a relatively stronger (negative) impact on operating profitability for private, compared to public firms. This is consistent with greater importance of efficient working capital management for firms with more restricted access to external financing.
Keywords: working capital; cash conversion cycle; private firms; listing status (search for similar items in EconPapers)
JEL-codes: G30 G31 G32 M40 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
http://www.mfsociety.org/modules/modDashboard/uplo ... lt8lknga73s59174.pdf (application/pdf)
http://www.mfsociety.org/modules/modDashboard/uplo ... ogleScholar/849.html (text/html)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:mfj:journl:v:16:y:2012:i:3-4:p:261-301
Access Statistics for this article
Multinational Finance Journal is currently edited by Panayiotis C. Andreou
More articles in Multinational Finance Journal from Multinational Finance Journal Contact information at EDIRC.
Bibliographic data for series maintained by Theodossiou Panayiotis ().