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Über dieses Buch

As the world is currently in the midst of financial and economic crises, this collection of expert contributions focuses on strategy formation and implementation at various organizational levels to address the challenges ahead. The latest economic turmoil and its ongoing impact on business performance are compelling top managers to develop effective business strategies and redefine the boundaries of their operational and strategic activities. On one hand, tremendous challenges in the competitive business environment have become a source of global threats for many small entrepreneurs. On the other, investors faced with today’s volatile economic conditions demand more gains on their capital investments to counter-balance the growing risk of global threats. This book explores the question as to whether it is possible to efficiently and effectively address these threats and obstacles. Are managers capable of planning and implementing strategic actions? What should the major managerial strategy be in order to overcome fluctuations in a market-oriented society?

The strategies and practices recommended here are aimed to design continuous development competencies and contribute to the stability, recovery and sustainability of global business operations under volatile economic conditions. This refreshingly novel book seeks to establish managerial strategies and practices for effectively responding to challenges in the competitive business environment, as global volatility and fluctuations continue to worsen.

Inhaltsverzeichnis

Frontmatter

Strategic Management and Practices in High Velocity Markets During Crisis

Frontmatter

Institutional Approach to Strategic Management

Abstract
The idea of an institution-based view (IBV) as a third perspective in strategic analysis (the first two being the industry-based and resource-based views) has been recently addressed by several strategy scholars. Institutions are both the medium for and the result of social action: they enable and constrain what firms and other agents wish to accomplish “directly determining what arrows a firm has in its quiver as it struggles to formulate and implement strategy and to create a competitive advantage” (Ingram and Silverman [“Introduction: The new institutionalism in strategic management.” Emerald, Bingley, 20, 2002]). This serves to underline that given the influence of institutions on firm behavior, any strategic choice is inherently affected by the formal and informal constraints of a given institutional framework. Our contribution focuses on a review of the role of institutions in strategic analysis drawing from literature on institutionalism and on the recently developed stream of the institution-based view.
Federica Brunetta, Francesca Capo, Francesca Vicentini

Economic Approach to Strategic Decisions

Abstract
After the 1980s, due to financialization and penetration of technology, business landscape has changed dramatically. These changes have created an extremely competitive business environment. In this business landscape, firms face so many challenges but at the same time, they are equipped with a large number of “strategic instruments” to deal with these obstacles. Key strategic instruments that are at the disposal of top managers to achieve competitive advantage include, among others: pricing, advertising, quality differentials, R&D, integration, acquisition, financial leverage, brand, and customer loyalty. The central premise of theories in microeconomic literature addresses the fundamental questions of why strategic decisions work differently for different firms and how firms achieve and sustain competitive advantage. Industrial organization which is a subfield in economics concentrates on addressing these research questions. Scholars in industrial organization have developed three distinct theories that investigate possible causative linkages between the performance and the use of alternative strategic instruments. These models are: structure-conduct-performance approach, five forces model, and transaction cost approach. The first objective of this study is to review these key theoretical models. According to the former two models, market structure plays major role in “success” of these instruments. In order to clarify the importance of market structure, we overview three strategic instruments: namely, pricing, advertising, and R&D. In addition to this, in order to demonstrate the significance of transaction cost approach, we include another important strategic instrument: integration. We show that the recent advances in transaction cost approach have greatly improved our understanding about integration, acquisition, and mergers.
Murat Aslan

Leading the Strategic Decision-Making Process: Conceptual Frameworks

Abstract
Leading the strategic decision-making process is a crucial issue in organizations. The success of the process is closely related to the experiences and special skills of the managers as well as to the culture and the structure of the organizations and environmental factors. Such a decision-making process requires improved cognitive, behavioral, and analytical skills from managers. This chapter investigates those success factors of the strategic decision-making process emphasized in the current literature and proposes two conceptual frameworks based on the factors for top managers that would help them to track the causality and the performance of their organizations within this scope.
Aşkın Özdağoğlu, Sabri Erdem, Güzin Özdağoğlu

Building Organizational Insight: Strategy and Organization

Abstract
In this chapter we focus on the organizational insight as a pivotal element in understanding the processes required to realize and achieve interrelationships among businesses. We devote particular attention to the element of synergy creation, horizontal strategy, and organizational coordination mechanisms. We do so, because at the corporate level, the development, or expansion, toward new businesses recalls the need for an organizational adaptation. Following Porter (“Competitive advantage: creating and sustaining superior performance,” Free Press, New York, 1985), among the possible sources of competitive advantage, lies the potential to develop interrelationships because of the different businesses or products that exist in the organization. Organizations shall therefore aim at developing interrelationships in order to allow the firm to avail of synergies, focusing on horizontal strategies to develop and maintain a competitive advantage. The organizational context—in terms of design, culture, and behavior—can motivate the organization to pursue interrelationships beyond other mere combinations of businesses, as synergies can produce a combined return on resources that is greater than the sum of individual parts.
Francesca Vicentini, Federica Brunetta, Francesca Capo

Strategies Out of Global Recession in Emerging Markets: An Application for 2008 Global Crisis

Abstract
The aim of this study is to define the success of the strategies in emerging markets in order to overcome the impact of economic crisis. Within this context, the strategies of 22 emerging countries in the 2008 global crisis were analyzed. Moreover, we made logit analysis by using the data for the period between 2008 and 2014. Furthermore, we defined growth rate as dependent variable. In addition to this aspect, we used eight independent variables in order to see the relationship. With respect to the independent variables, five of them are related to monetary policy tools, and three of them refer to fiscal policy tools. As a result of the analysis, it was determined that the explanatory variable of “government debt” is statistically significant at 10 % level and the coefficient of this variable is negative. This result shows that there is a negative relationship between government debt and growth rate in emerging economies. In other words, the policy of decreasing government debt is a successful strategy in order to overcome economic crisis in emerging countries. Because of this situation, emerging economies should firstly focus on increasing liquidity by reducing government debt amount so as to overcome recession in a crisis period.
Serhat Yüksel

Alternative Strategies for Global Operations of Organizations

Abstract
Nowadays, globalization (and internationalization) is accepted as a fact by both its proponents and opponents. Globalization influences all parts of our lives. As a natural consequence of this development, it has some considerable impacts upon organizations as well. The aim of the study is to present entrance alternatives for international markets and strategies that can be preferred by international organizations in an integrative way. Therefore, first, a basic framework will be drawn for globalization by the author. Then, as a part of globalization, alternative strategies of organizations in order to access new markets will be examined. The final section is allocated for fundamental strategic options for international competition.
Mehmet Eryılmaz

Designing Competitive Strategies, Leadership and Culture During Recession

Frontmatter

Building Competitive Strategies and Managing Stakeholder Relations

Abstract
Stakeholder management and competitive strategy concepts are very important for a company’s position and its corporate structure and for understanding which sectors or customer groups have an effect on business, how the company can be successful, and whether the company can respond to the demands and needs of stakeholders. In the traditional view, stakeholders include employees, shareholders, suppliers, and customers; however, the society, nongovernmental organizations, governments, and media also have a significant impact on business. Therefore, stakeholders have been examined as internal and external ones. To achieve sustainability for their business, companies should strategically analyze and evaluate the stakeholders, who are at the core of their activities and fulfill their necessary responsibilities. This study illustrates the performance results of the stakeholder management theory analyses and competitive strategy on globalization: (1) the stakeholders and competitive strategy of the companies suitable for their employees and management team’s expectations; (2) determining how to meet the expectations of stakeholders; (3) relations between stakeholders and business performance; and (4) finally, relationships with stakeholders, the strategies for managing stakeholders, and the relationship between the business performance and stakeholders.
Zafer Adiguzel

Human Side of Strategic Alliances, Cooperations and Manoeuvrings During Recession and Crisis

Abstract
Together with the globalizing economy, it is no more possible for any system to survive by ignoring the market changes and transformations. A change taking place anyhow in any place of the world triggers complex processes and affects everyone by growing in waves. Successful ways of business conduct of today is based on predicting the growth speed of these waves and on the ability to carry out strategic cooperations and manoeuvres accordingly. Sometimes these fluctuations also trigger serious crises. Apart from the shocks created in organizational structures, periods of crisis have complex effects on people. Some people approach to these events in hesitation, while other people or organizations happen to have skills to turn these processes into opportunity. The practical examples show that the organizations that adapt to new condition by getting simpler and getting rid of burdens in the constriction process are able to come out in a better condition before the crisis. This section discusses the way of organizations to become human oriented when acting strategically during strategic alliances, cooperations and manoeuvrings.
Tuna Uslu

The Role of Organizational Identity on Strategic Management Applications

Abstract
The new millennium started with evident hints that strategic management is one of the most required skills for business success. Previous research has shown that as a competitive advantage factor, organizational identity affects strategic thinking, planning, decisions and actions. Based on the past research, at the core of this chapter lies the idea that organizational identity can act as a detector for identifying strategic issues and can be an influential factor in developing strategies in response to change. Moreover, a strong organizational identity is a valuable organizational capability that can create competitive advantage through its urge to adapt to changes. Conversely, a loose identity is weak in detecting changes or threats directed to the organization. Thereby, the chapter focuses on the interaction between identity and strategy when organizations face challenges in the turbulent business environment.
Tuba Bozaykut Buk

The Importance of Trust for Partnership and Collaboration in Volatile Economic Conditions

Abstract
Volatile economic conditions are painful for most firms. Firms struggle to survive when market demand is sluggish, uncertainties are high, and credit conditions are tight. Therefore, maintaining and strengthening partnerships, retaining existing customers or finding new ones through innovation, and finding external finance are extremely vital to keep firms alive during volatile economic conditions. In this chapter we argue that trust plays a key role in protecting strong relationships with partners, customers, suppliers, and other actors or when developing new relationships. Trust might help to protect partnerships and establish collaborative relationships by mitigating asymmetric information and free-rider problems, allowing for more open and honest information sharing and restraining opportunistic behaviour.
Nurullah Gur, Nihat Alayoğlu

Complexity and Crisis Call for Shared Leadership and Empowered Teams

Abstract
It is a very well-known fact that firms are operating in a very volatile business environment. The success and failure of every type of organisation mainly depends on the quality of leadership, and the complexity of today’s business environment makes leadership increasingly challenging. Many crisis management mistakes have been attributed to leadership failures. It is becoming almost impossible for any individual to possess all of the skills and abilities needed to competently navigate organisations through today’s challenges. Complexity and crisis by their very nature call for looking at the leadership role from a new perspective and responding to the new reality differently to sustain a business.
Here, we will first explore the nature of complexity and crisis. By doing that, we illustrate the requirements of those situations in terms of leadership, and we move on to explain the concept of shared leadership and what is needed to apply it effectively. Since business culture is of vital importance in the effective application of shared leadership, we will delineate how leaders can create a culture that fosters empowerment for teams.
Huseyin Cirpan

Strategic Entrepreneurship, Innovation and Design

Frontmatter

Establishing an Innovation Culture and Strategic Entrepreneurship

Abstract
The purpose of this chapter is threefold: one, to focus on the concept of innovation under today’s global economic realities, two, to focus on the strategic entrepreneurship literature, and finally to combine these two pieces together. The chapter concentrates on innovation management in terms of the interrelationship among the four elements of a business: product, process, marketing, and organizational qualities. This chapter provides a review and interpretation of innovation and management literatures in different fields with an eye toward combining them into the framework of strategic entrepreneurship.
Halil Kürşad Aslan

Strategies for Innovative Organization Structure: Innovative Culture and Open Innovation

Abstract
One of the main factors ensuring the survival of the organizations is their innovation capacity. They have to put the products and services to be implemented on the market prior to their competitors by predicting the customer needs in order to gain advantage during the intense competition in the modern business world. These strategies providing the speed and consequently the competitive advantage can only be determined and applied in an appropriate organization structure. The appropriate organization structure for innovation is the organic structure convenient for dynamic environments. Additionally, the innovation may be easily developed in ambidextrous organization structures supporting both radical and incremental innovation. Other factors that catalyze the innovation are tolerance for the mistakes, continuous learning, motivation for risk taking, competitiveness, good management of conflict, open communication characteristics, and innovative organization culture. The external orientation which is the common feature of innovative organization culture and innovative organization structure brings along the open innovation which is the inevitable approach of our present day. By accepting that the innovation idea source may come within the organization as well as from outside and creating a system accordingly will have an effect which will increase the organization’s innovation potential.
Güney Çetin Gürkan, Şule Aydın Tükeltürk

Building Innovative Strategies for the Competitiveness of Family Firms in Emerging Markets

Abstract
Studies based on the relationship between the evolution of family firms and their innovative performance have been rare in family-business research. This chapter reviews the characteristics of family firms and their relation to innovation strategies in emerging markets, with the case of Turkish family firms, and provides an explorative analysis of the relationship between the factors affecting the development of family business and their innovative strategies in Turkey. The most prevalent characteristics of Turkish family firms that affect their innovation decisions are the collectivist family culture, pragmatic growth decisions, and paternalistic control tendencies. The differences based on these characteristics should affect their approach to innovation differently. Founders follow an exploitative innovation strategy. Later generations coming after the founder generation generally focus on more exploratory strategies to meet market demands. By the third generation, as the firm has institutionalized, they try to balance the two forms of innovation by using their resources and exploring environmental opportunities in the form of ambidexterity.
Nihat Erdoğmuş, Gökçen Arkali Olcay, Erkan Erdemir

Innovative Processes in New Product and Service Development

Abstract
There are many processes for new product and service development. The common shortcomings of these models are being linear and excluding feedback loops, lacking of customer or supplier involvement, and not being connected to market conditions before the actual rollout of the products. This chapter reviews the existing new product development processes and sheds light on two new models: (1) customer development and (2) lean startup in terms of customer feedback, market connection, and product revision.
Muhsin Bayik

Increasing Strategic Competitiveness Through Innovation: The Finance Perspective

Abstract
With the start of the new millenium, marked by the disruptive power of Internet technologies, it is almost commonly acknowledged that innovative firms grow faster and perform financially better than those who fail to rapidly mobilize their social and financial capital resources to discover newer, more efficient, and ingenious ways of doing business and creating alternative sales venues. Thus, if the term innovation has come to refer to “the process of turning ideas into reality, exploiting windows of opportunities, and capturing value from them” in essence, innovation, then, can be regarded as a beneficial and intrinsically “good” phenomenon. This is true especially for the technology and telecomunications industries according to the Thomson Reuters’ 2015 State of Innovation Report, which were ranked the most innovative industries with 30 % and 13 % of patent filings in 2014, respectively (http://​www.​businessinsider.​com/​most-innovative-industries-2015-5). Evidently though, innovation is not a win-win game for all stakeholders as laid out back in the 1930s by the Schumpeterian “creative destruction” concept portraying a “quasi-Darwinian” and rather pessimistic view of a process that serves mainly capitalistic motivations in the forms of securing monopoly profits and eventually eradicating a wide range of industries. Looking back at the past couple of decades, financial innovation has become one of the most far-reaching types of innovations, in terms of both, scope and its prolonged repurcussions. This chapter discusses the concept of financial innovation as a strategically competitive tool.
Semen Son-Turan

Economic Growth and Dynamic R&D Investment Behavior

Abstract
Since the early 1990s, researchers have tried to show through endogenous growth models that the power which creates technological innovation is research and development (henceforth R&D) activities. The importance of R&D activities in the emergence of technological innovation is discussed in those models. Those models also highlight that countries can have strong economies only if they give importance to innovation and R&D activities and that developed countries are considered as technologically developed countries. Those models also emphasize that economic growth is in parallel with technological developments and that technological developments can be realized through investments in R&D. That is why the relation between R&D expenditures and economic growth has been studied over the years and not only the existence of this relationship but also its direction has recently become a hotly debated topic. This study aims to test whether R&D model predictions are valid for 76 countries’ economies. The economic methodology used in this study is panel VAR analysis. Values for the GDP per capita variable that is considered to represent economic growth and R&D per capita variable that is considered to represent R&D activities have been obtained from the World Bank Database. The analysis of the annual data between 1996 and 2014 suggests that economic growth Granger-causes R&D spending, but there is no evidence to suggest that R&D spending has an impact on economic growth.
Ozlem Ozturk Cetenak, Gurcem Oransay

Managing Risks Through Adaptive Strategies and Decision Systems During Crisis

Frontmatter

Risk Management Practices in Strategic Management

Abstract
Risk management practices in strategic management are ever increasingly seen as a competition factor at all levels of management. The recent economic turmoil and its continuing reflections have obliged, especially top managers to take precautions in order to avoid the crisis and its strong effects. Numbers of prudent and conscious organizations have started to implement risk management practices while some of the organizations have remained same. In this study, the process of risk management implementations has been examined in terms of strategic management by reviewing the literature. This chapter discusses risk factors and risk management practices in terms of strategic management in order to understand effects of economical fluctuations on the firms and to keep up with the globalization.
Gökçe Çiçek Ceyhun

Reducing Risk Through Strategic Flexibility and Implementation Leadership in High-Velocity Markets

Abstract
Firms operating in dynamic business environments where political instability, high level of market complexity, financial ambiguity, and risk dominate the whole market must develop special capabilities to gain competitive advantage or even survive. Among these capabilities, strategic flexibility enables firms to dynamically manage their resources for adapting to high-velocity environments and reducing risks, and it also helps firms exploit the full potential of their key resource stocks. Strategic flexibility allows firms to respond quickly to unstable environments and act promptly when it is time to halt or reverse existing resource commitments. In order to establish a flexible organization, firms scan environment thoroughly and make their investment decisions and determine their priorities according to existing situations and future environmental precautions. Strategic flexibility can play a critical role for firms to reduce the risk by offering agile and prudent solutions in volatile environments. Yet, implementation of these decisions and objectives is subject to senior management’s determination. Therefore, an implementation leadership style can also be vitally important to achieve “risk reduction”-related objectives. Strategic leadership that initiates the alignment of people to strategy may enable the implementation of risk management practices in the firm. This chapter explains the effects of strategic flexibility and implementation leadership on reducing risk in high volatile markets.
Rifat Kamasak, Meltem Yavuz, Tulay Yazar Ozturk

Implementing Adaptive Strategies of Decision Support Systems During Crises

Abstract
A typical Decision Support System requires data access, a model enhanced with proper machine learning algorithms and a user interface. So, thanks to the development of fast machine learning algorithms and big data, Decision Support Systems may be used as Executive Information Systems in practice to support the decisions of executives. With the improvement of science and technology, it has become more feasible to store large amounts of data both on local and remote databases. New and robust machine learning algorithms are available to process this data and extract information to support decision makers and decision-making processes like future risk management, investment plans, predicting opportunities in the sector, long-term recruitment plans, and employee training programs. In this chapter, decision support systems have been presented in general. Additionally, some details have been given about how to use decision support systems and for what business purposes they may be exploited by the top management.
Gökhan Silahtaroğlu

The Formulation of Strategies to Mitigate Supply Risks

Abstract
The integration of markets through globalization leads to the formation of global supply chains in which supply chain partners and operations disperse to wide geographical areas. Although global supply chains refer to the expansion of markets and the higher production efficiency, they embed higher number of and more serious risks than domestic/traditional supply chains have. For this reason, firms being part of global supply chains need to manage their supply chain risks more elaborately. They need to have systematic approach to identify all supply risks and should be able to prepare the priority list of these supply risks with appropriate tools and techniques. Next, it is imperative for these firms to determine the right strategy so that they are able to both prevent themselves from the destructive negative impacts of risky events and reduce the amount of expenditure made on the actions to mitigate their supply risks.
Metehan Feridun Sorkun, Meltem Onay

Evaluation of Firm Performance, Financial Efficiency and Managerial Control

Frontmatter

Applying Data Envelopment Analysis to Evaluate Firm Performance

Abstract
The purpose of this study is to evaluate the performance of Turkish firms listed in corporate governance index using some financial variables and corporate governance. The research involves 31 nonfinancial firms listed in Borsa Istanbul (BIST), and the data are obtained from the firms’ financial statements in 2015. For this purpose, the firms’ performance was evaluated by conducting the Data Envelopment Analysis (DEA), which is a Multicriteria Decision-Making (MCDM) method. In this study, the analysis was conducted in two steps. In the first step, the DEA model was built using total assets and total equity as inputs with sales and profit as outputs. In the second step, the same DEA model was repeated by adding corporate governance rating as a new input only. Then, it was observed that the efficiency of the firms increased significantly in almost every aspect. This increase indicates that it was required to use corporate governance rating to get an appropriate firm performance as well as financial values.
Emine Ebru Aksoy, Ayse Yildiz

Efficiency and Managerial Control in Financial Institutions

Abstract
Studies measuring the efficiency levels of financial institutions including the banks and insurance companies have dramatically boosted in the efficiency and productivity analysis literature especially during the last two decades. The undesirable output sets that are under the control of managerial bodies in the financial institutions stimulate researchers to explain the potential relationship between the managerial control and inefficient usage of resources in this particular industry. Besides, the risks occurred throughout the decision-making process within the financial institutions started to be integrated into the efficiency analysis of financial sector. The primary goal of this chapter is to summarize and critically review the theoretical and empirical literature on the efficiency and managerial control in the financial institutions as well as to put forward a set of arguments about this specific discussion. Secondarily, recent efficiency literature leans towards to the inefficiency of foreign-owned financial institutions (i.e. banks) in regards to performance. Estimated efficiency frontiers of foreign-based banks compared to domestic banks are found to be lower; therefore, international consolidation efforts are argued to be slow in this industry. On the other hand, the international diversification has still been on the agenda of the mainstream portfolio prescriptions. Considering these arguments, this chapter also seeks to highlight the recent empirical works aiming to continue this intellectual conversation.
Mehmet Fatih Acar, Aziz Bakay, Taptuk Emre Erkoç

Examining Financial Innovation and Performance in Financial Sector: A Comprehensive Review of Emerging Markets

Abstract
Today, the competitiveness of organizations depends on the adaptation to the changes and moving in line with changing needs and demands of customers. Innovation is a critical determinant of increasing the organizational outcomes in emerging markets as they integrate various types of innovations like product, service, process, organizational, marketing, and financial innovation. Financial innovation has become a major type of innovation in various industries. In this respect, it is critical to apply innovation policy as a part of core business. The purpose of this study is to examine the concept of innovation and to review the given literature of financial innovation and financial performance relationship in financial sector, particularly in emerging markets. The study is intended to contribute to literature by providing a comprehensive review of conceptual relationship between financial innovation and performance.
Melisa Erdilek Karabay, Gülcan Çağıl

The Impact of Selected Firm Features on Sales Growth: Empirical Evidence from S&P500

Abstract
Firm growth is an important research topic in the academic arena and accepted as a leading indicator of firm’s health. However, the debate as to the determinants of growth has not yet been fully solved. Many studies concocted in developed and developing economies, already attempted to identify the driving forces that spur firm growth. This study investigates how selected factors influence sales growth of firms by employing 22 years of consecutive data on a sample of 243 nonfinancial Standard and Poor’s 500 (S&P500) companies. The empirical findings of panel data analysis demonstrate significant influence of previous year sales growth, average growth rate of relevant industry, firm size, and change in profitability level on the selected proxy of firm growth. Additionally, financial leverage, market-to-book ratio, price-to-earnings ratio, and plowback ratio are not found to have any significant relationship with the growth rate of the firm. A crucial result to emphasize is that the market in which firms operate is the major force that spurs growth, and this impact is captured by the industry growth variable.
Ali Osman Gurbuz, Levent Ataunal, Asli Aybars

Determinants of Working Capital in Emerging Markets: Do Economic Developments Matter?

Abstract
Previous literature established on the effects of working capital management on firm’s profitability or firm value and focused mostly on firm-level determinants of working capital. In this study, we aimed to examine the determinants of working capital management not only at firm level but also industry-country level. Our sample consists of 1253 manufacturing firms across 13 industries from 14 emerging markets between year 2000 and 2014. Our findings indicate that at firm-level variables, return on asset has a negative relationship with working capital while Tobin Q and Altman Z-score have a positive. At industry-country level variables, HH index, exchange rate, Lerner index, and rule of law have a positive relationship with working capital levels while credit from private sector variable has a negative relationship with working capital levels.
Emin Hüseyin Çetenak, Gamze Vural, A. Gökhan Sökmen

Liquidity Position and Working Capital Adequacy of Companies in Turkey: Outlook from Industry Financial Statements

Abstract
This chapter aims to give detailed information especially about liquidity and working capital positions of Turkish companies. In addition to the liquidity, detailed analysis about profitability and debt structure is conducted. The adequacy of a company’s working capital depends on the industry in which it competes and its relationship with its customers, suppliers, and the macroeconomic environment the company operates in.
Due to the need of industrial view, differently from the other studies which generally focus on listed companies, this study uses industry financial statements released by Central Bank of Turkey. The data belong to the period between 2009 and 2014.
In short, in this study the importance of liquidity is addressed and also the relationship between the liquidity and working capital adequacy is highlighted from an industrial perspective.
The results indicate poor liquidity, receivable dependence, predomination of debt, inconstant net working capital turnover, and low profitability especially in the crisis period. Thereto this, manufacturing-related industries have higher liquidity and profitability.
Yusuf Gumus, Esra Aslanertik, Guluzar Kurt Gumus

Determinants of Corporate Cash Holdings: Firm Level Evidence from Emerging Markets

Abstract
The objective of this chapter is to investigate the factors affecting corporate cash holdings in five emerging markets, namely Brazil, Indonesia, Mexico, Russia, and Turkey. The sample consists of 1991 firms listed on the major stock exchange of their countries and covers the period between 2009 and 2015. The model is estimated by Arellano–Bond dynamic generalized method of moments. Results show that firms which use higher leverage in their capital structure hold more cash. More profitable firms are shown to have higher levels of cash holdings. Another variable which has a positive effect on the level of cash holdings in any given period is the level of cash holdings in the previous period as shown by the positive and significant coefficient of the lagged dependent variable in the model. Liquidity and firm size have a negative and statistically significant impact on the level of corporate cash holdings. Firms with higher level of capital expenditures are also shown to hold less cash. Finally, growth opportunities do not have a significant impact on the level of cash holdings for the firms in the emerging markets analyzed.
Elif Akben-Selcuk, Ayse Altiok-Yilmaz
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