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  4. Effects of Working Capital Management on Small-Sized Businesses in Competitive Environments with Economic Policy Uncertainty—A Case Study Applied to Chilean Companies
 
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Effects of Working Capital Management on Small-Sized Businesses in Competitive Environments with Economic Policy Uncertainty—A Case Study Applied to Chilean Companies
Dr. Gallegos-Mardones, Juan 
Facultad de Ciencias Económicas y Administrativas 
Moraga-Flores, Hugo Alejandro
Briones Soto, Vanessa Paulina
Facultad de Ciencias Económicas y Administrativas 
10.3390/su16219289
MDPI AG
2024
Working capital is a strategic resource that not only enhances financial performance but also ensures the long-term sustainability of organizations, especially SMEs. In the context of evolving economic policies and the challenges of gender equity affecting Chilean companies, this study explores how economic policy risk (EPU) and CEO characteristics influence working capital, which are essential investments for sustainable growth. The analysis covers 12,839 SMEs from 2014 to 2019. Using a fixed-effects panel data model, the findings reveal that firms tend to increase their investment in working capital in response to rising economic policy uncertainty. However, the relationship follows a non-linear inverted U-shaped pattern, which suggests the existence of an investment optimum between working capital and the EPU. Considering the level of competition, companies increase their investment in working capital when the level of competition is higher. Regarding the gender and age of CEOs, it is observed that women invest less in working capital, as do young CEOs. These results underscore the importance of EPU, along with the gender and age of CEOs, as key factors in promoting sustainable working capital management.
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Effects of Working Capital Management on Small-Sized Businesses in Competitive Environments with Economic Policy Uncertainty—A Case Study Applied to Chilean Companies.pdf

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Small and medium enterprises (SMEs)
Working capital management
Economic policy uncertainty (EPU)
Chile
Historial de mejoras
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