Working Capital Management and Corporate Profitability of Japanese Firms

The Empirical Economics Letters Volume 13, Number 1, 2014

9 Pages Posted: 26 Jan 2014 Last revised: 31 Dec 2017

See all articles by Haitham Nobanee

Haitham Nobanee

University of Oxford; Abu Dhabi University; University of Liverpool

Ayman E. Haddad

American University of Kuwait

Date Written: January 25, 2014

Abstract

This study examines the relationship between working capital management, profitability, firm size and industry type for firms in Japan. The study sample consists of 2123 Japanese non-financial firms listed at the Tokyo Stock Exchange for the period 1990-2004. We observe that the cash conversion cycle and return on investment relationships are commonly significant and negative, suggesting that the shortening of the cash conversion cycle enhances the profitability of Japanese firms.

Keywords: Working Capital Management; Cash Conversion Cycle; Receivable Collection Period; Inventory Conversion Period; Payable Deferral Period; Return On Investment

Suggested Citation

Nobanee, Haitham and Nobanee, Haitham and Haddad, Ayman E., Working Capital Management and Corporate Profitability of Japanese Firms (January 25, 2014). The Empirical Economics Letters Volume 13, Number 1, 2014, Available at SSRN: https://ssrn.com/abstract=2385351

Haitham Nobanee (Contact Author)

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

Abu Dhabi University ( email )

Abu Dhabi
United Arab Emirates

University of Liverpool ( email )

Chatham Street
Brownlow Hill
Liverpool, L69 7ZA
United Kingdom

Ayman E. Haddad

American University of Kuwait ( email )

Department of Accounting
Kuwait, 13034
Kuwait

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