The interrelationship of working capital: The role of financial bootstraping and government support

Rita Maria Rio (), Supramono (), Dayamanti Theresia Woro () and Nastiti Pambayun Kinasih Yekti ()
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Rita Maria Rio: Satya Wacana Christian University, Indonesia
Supramono: Satya Wacana Christian University, Indonesia
Dayamanti Theresia Woro: Satya Wacana Christian University, Indonesia
Nastiti Pambayun Kinasih Yekti: Satya Wacana Christian University, Indonesia

Financial Internet Quarterly (formerly e-Finanse), 2024, vol. 20, issue 1, 51-63

Abstract: This study aims to investigate the effects of financial bootstrapping and government support on working capital, as well as the moderating role of entrepreneurial orientation towards the impact of working capital on financial performance. The study was conducted on 260 MSME owners in the food and beverage sector in Semarang, Surakarta, and Salatiga, in Central Java Province, Indonesia. By using a Partial Least Squares-Structural Equation Modeling (PLS-SEM) analysis, the determinant effects and consequences of working capital were determined. The findings of this study indicate that financial bootstrapping and government support are proven to have a significant positive effect on working capital. Working capital has a significant positive effect on financial performance, but entrepreneurial orientation is not confirmed to moderate the effect of working capital on financial performance.

Keywords: Financial Performance; Working Capital; Entrepreneurial Orientation; Financial Bootstrapping; Government Support (search for similar items in EconPapers)
JEL-codes: G32 G51 L26 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:finiqu:v:20:y:2024:i:1:p:51-63:n:5

DOI: 10.2478/fiqf-2024-0005

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