The speed of adjustment in net operating working capitalan international study

  1. Sonia Baños-Caballero 1
  2. Pedro J. García-Teruel 1
  3. Pedro Martínez-Solano 1
  1. 1 Universidad de Murcia
    info

    Universidad de Murcia

    Murcia, España

    ROR https://ror.org/03p3aeb86

Revista:
Revista española de financiación y contabilidad

ISSN: 0210-2412

Año de publicación: 2021

Volumen: 50

Número: 4

Páginas: 423-440

Tipo: Artículo

DOI: 10.1080/02102412.2020.1864176 DIALNET GOOGLE SCHOLAR

Otras publicaciones en: Revista española de financiación y contabilidad

Objetivos de desarrollo sostenible

Resumen

This paper analyses whether there are differences in the speed of adjustment in net operating working capital (NWC) across countries. Unlike prior research, which reported that the adjustment speed of any current item is always rapid, we find that the speed of adjustment to NWC targets depends on a country’s investor protection and financial development. Specifically, using a sample of firms from 30 countries, we show that NWC adjustment speeds vary across countries, and they are faster for companies that operate in countries with stronger investor protection and greater financial development.

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