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The Relationship between Financial Flexibility, Firm Value and Financial Performance: Panel Quantile Regression Approach on the Construction Sector

Year 2021, Volume 29, Issue 49, 409 - 425, 30.07.2021
https://doi.org/10.17233/sosyoekonomi.2021.03.21

Abstract

The study aimed at determining the relationship between financial flexibility, firm value, and financial performance of firms operating in the construction sector for the period 2013:12-2020:06 by employing the panel quantile regression method. Two different panel quantile regression models representing firm value and financial performance for 0.25, 0.50 and 0.75 quantile segments were created in the study. Model evaluations were performed for the Q2=0.5 segment, where the absolute deviation of errors is the smallest. The results suggest that firm value and financial performance both display a significant and positive relationship with financial flexibility. It was concluded that financial flexibility is valid for companies in the construction industry.

References

  • Abdioğlu, N. & S. Aytekin (2016), “Finansal Esnekliğin Firma Performansı Üzerindeki Etkilerinin Değerlendirilmesi: Borsa İstanbul İmalat Sanayi Sektörü Üzerinde Bir Uygulama”, Adıyaman Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 8(22), 309-327.
  • Altaf, N. (2020), “Working Capital Financing, Firm Performance and Financial Flexibility: Evidence from Indian Hospitality Firms”, Global Business Review, <https://journals.sagepub.com/doi/full/10.1177/0972150920961371>, 22.11.2020.
  • Altın-Yavuz, A. & E. Gündoğan-Aşık (2017), “Kantil Regresyon”, International Journal of Research and Development, 9(2), 137-146.
  • Ayaydın-Arslan, Ö. & C. Florackis & A. Ozkan (2008), “How and Why Do Firms Establish Financial Flexibility”, Working Paper, Hull University Business School.
  • Ayaydın-Arslan, Ö. & C. Florackis & A. Ozkan (2014), “Financial Flexibility, Corporate Investment and Peformance: Evidence from Financial Crises”, Review of Quantitative Finance and Accounting, 42(2), 211-250.
  • Bai, J. & S. Ng (2004), “A PANIC Attack on Unit Roots and Cointegration”, Econometrica, 72(4), 1127-1177.
  • Breusch, T. & A. Pagan (1980), “The Lagrange Multiplier Test and Its Applications to Model Specification in Econometrics”, Review of Economic Studies, 47(1), 239-253.
  • Byoun, S. (2011), Financial Flexibility and Capital Structure Decision, <http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1108850>, 22.11.2020.
  • Chang, H. & C. Ma (2019), “Financial Flexibility, Managerial Effeciency and Firm Life Cycle on Firm Performance”, Journal of Advances in Management Research, 16, 168-180.
  • Chen, N. & E.N. Hsiao (2014), “Insider Ownership and Financial Flexibility”, Applied Economics, 46(29), 3609-3629.
  • Choi, J.J. & M. Ju & M. Kotabe & L. Trigeorgis & X.T. Zhang (2015), “Flexibility as Firm Value Driver: Evidence from Offshore Outsourcing”, Global Strategy Journal, 8(2), 351-376.
  • DeAngelo, H. & A.S. Goncalves & R.M. Stulz (2018), “Corporate Deleveraging and Financial Flexibility”, Review of Financial Studies, 31(8), 3122-3174.
  • Gamba, A. & A. Triantis (2008), “The Value of Financial Flexibility”, The Journal of Finance, 63(5), 2263-2296.
  • Gu, Y. & F. Yuan (2020), “Internal Control, Financial Flexibility and Corporate Performance - Based on Empirical Analysis of Listed Companies in Information Technology Industry”, ISEITCE 2020 IOP Publishing Journal of Physics: Conference Series 1607 (2020), 012118.
  • Knuth, D.E. (1969), “Seminumerical Algorithms”, The Art of Computer Programming, 2(1), Boston: Addison Wesley.
  • Koenker, R. & G. Jr. Bassett (1978), “Regression Quantiles”, Econometrica, 46(1), 33-50.
  • Lie, E. (2005), “Financial Flexibility, Performance, and the Corporate Payout Choice”, The Journal of Business, 78(6), 1-24.
  • Liping, X. & L. Zhe & L. Shu (2013), “Financial Flexibility, Corporate Investment and Performance: Evidence from China’s Listed Companies”, 2013 Fourth International Conference on Intelligent Systems Design and Engineering Applications, 6-7 November, China.
  • Ma, C. & Y. Jin (2016), “What Drives the Relationship between Financial Flexibility and Firm Performance: Investment Scale or Investment Efficiency? Evidence from China”, Emerging Markets Finance and Trade, 52(9), 2043-2055.
  • Marchica, M.T. (2010), “Financial Flexibility, Investment Ability, and Firm Value: Evidence from Firms with Spare Debt Capacity”, Financial Management, 39(4) 1339-1365.
  • Meier, I. & Y. Bozec & C. Laurin (2016), “Financial Flexibility and the Performance During the Recent Financial Crisis”, International Journal of Commerce and Management, 23(2), 79-96.
  • Mokhtar, I. & N. Salamudin & S.R. Zambahari (2013), “Financial Flexibility and Corporate Performance of Bumiputera Public Listed Companies”, International Conference on Economics and Business Research, 15-16 July, Malaysia.
  • Özel, A.H. & F. Sezgin (2012), “Ticari Serbestleşme-Ekonomik Büyüme İlişkisinin Bootstrap Kantil Regresyon Yardımıyla Analizi”, İktisat Fakültesi Mecmuası, 62(2), 283-303.
  • Pesaran, H. (2004), “General Diagnostic Tests for Cross Section Dependence in Panels”, Cambridge Working Papers in Economics, Working Paper, 435.
  • Rapp, M.S. & T. Schmid & D. Urban (2014), “The value of Financial Flexibility and Corporate Financial Policy”, Journal of Corporate Finance, 29, 288-302.
  • Waghmare, P. & C. Jacksone & J. Poulose & P. Krishnan & S. Mundeja & V. Deep & V. Singh (2011), “An Empirical Study of Factors that Influence Financial Flexibility”, Financial Structure and Financial Performance of a Firm, <https://scholar.google.com/scholar?hl=tr&as_sdt=0%2C5&q=An+Empirical+Study+of+factors+that+influence+Financial+Flexibility%2C+Financial+Structure+and+Financial+Performance+of+a+Firm&btnG=>, 23.11.2020.

Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı

Year 2021, Volume 29, Issue 49, 409 - 425, 30.07.2021
https://doi.org/10.17233/sosyoekonomi.2021.03.21

Abstract

Bu çalışmada, 2013:12-2020:06 dönemi için inşaat sektöründe faaliyet gösteren firmaların finansal esneklikleri ile firma değeri ve finansal performansları arasındaki ilişkiyi panel kantil regresyon yöntemi ile ortaya çıkarmak amaçlanmıştır. Çalışmada, 0,25, 0,50 ve 0,75 kantil dilimleri için firma değerini ve finansal performansı temsil eden iki farklı panel kantil regresyon modeli oluşturulmuştur. Hataların mutlak sapmasının en küçük olduğu Q2=0,5 dilimi için model değerlendirmeleri gerçekleştirilmiştir. Çalışma sonucunda, finansal esneklik ile firma değeri ve finansal performans arasında anlamlı ve pozitif ilişki tespit edilirken, inşaat sektöründeki firmalar için finansal esnekliğin geçerli olduğu sonucuna varılmıştır.

References

  • Abdioğlu, N. & S. Aytekin (2016), “Finansal Esnekliğin Firma Performansı Üzerindeki Etkilerinin Değerlendirilmesi: Borsa İstanbul İmalat Sanayi Sektörü Üzerinde Bir Uygulama”, Adıyaman Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 8(22), 309-327.
  • Altaf, N. (2020), “Working Capital Financing, Firm Performance and Financial Flexibility: Evidence from Indian Hospitality Firms”, Global Business Review, <https://journals.sagepub.com/doi/full/10.1177/0972150920961371>, 22.11.2020.
  • Altın-Yavuz, A. & E. Gündoğan-Aşık (2017), “Kantil Regresyon”, International Journal of Research and Development, 9(2), 137-146.
  • Ayaydın-Arslan, Ö. & C. Florackis & A. Ozkan (2008), “How and Why Do Firms Establish Financial Flexibility”, Working Paper, Hull University Business School.
  • Ayaydın-Arslan, Ö. & C. Florackis & A. Ozkan (2014), “Financial Flexibility, Corporate Investment and Peformance: Evidence from Financial Crises”, Review of Quantitative Finance and Accounting, 42(2), 211-250.
  • Bai, J. & S. Ng (2004), “A PANIC Attack on Unit Roots and Cointegration”, Econometrica, 72(4), 1127-1177.
  • Breusch, T. & A. Pagan (1980), “The Lagrange Multiplier Test and Its Applications to Model Specification in Econometrics”, Review of Economic Studies, 47(1), 239-253.
  • Byoun, S. (2011), Financial Flexibility and Capital Structure Decision, <http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1108850>, 22.11.2020.
  • Chang, H. & C. Ma (2019), “Financial Flexibility, Managerial Effeciency and Firm Life Cycle on Firm Performance”, Journal of Advances in Management Research, 16, 168-180.
  • Chen, N. & E.N. Hsiao (2014), “Insider Ownership and Financial Flexibility”, Applied Economics, 46(29), 3609-3629.
  • Choi, J.J. & M. Ju & M. Kotabe & L. Trigeorgis & X.T. Zhang (2015), “Flexibility as Firm Value Driver: Evidence from Offshore Outsourcing”, Global Strategy Journal, 8(2), 351-376.
  • DeAngelo, H. & A.S. Goncalves & R.M. Stulz (2018), “Corporate Deleveraging and Financial Flexibility”, Review of Financial Studies, 31(8), 3122-3174.
  • Gamba, A. & A. Triantis (2008), “The Value of Financial Flexibility”, The Journal of Finance, 63(5), 2263-2296.
  • Gu, Y. & F. Yuan (2020), “Internal Control, Financial Flexibility and Corporate Performance - Based on Empirical Analysis of Listed Companies in Information Technology Industry”, ISEITCE 2020 IOP Publishing Journal of Physics: Conference Series 1607 (2020), 012118.
  • Knuth, D.E. (1969), “Seminumerical Algorithms”, The Art of Computer Programming, 2(1), Boston: Addison Wesley.
  • Koenker, R. & G. Jr. Bassett (1978), “Regression Quantiles”, Econometrica, 46(1), 33-50.
  • Lie, E. (2005), “Financial Flexibility, Performance, and the Corporate Payout Choice”, The Journal of Business, 78(6), 1-24.
  • Liping, X. & L. Zhe & L. Shu (2013), “Financial Flexibility, Corporate Investment and Performance: Evidence from China’s Listed Companies”, 2013 Fourth International Conference on Intelligent Systems Design and Engineering Applications, 6-7 November, China.
  • Ma, C. & Y. Jin (2016), “What Drives the Relationship between Financial Flexibility and Firm Performance: Investment Scale or Investment Efficiency? Evidence from China”, Emerging Markets Finance and Trade, 52(9), 2043-2055.
  • Marchica, M.T. (2010), “Financial Flexibility, Investment Ability, and Firm Value: Evidence from Firms with Spare Debt Capacity”, Financial Management, 39(4) 1339-1365.
  • Meier, I. & Y. Bozec & C. Laurin (2016), “Financial Flexibility and the Performance During the Recent Financial Crisis”, International Journal of Commerce and Management, 23(2), 79-96.
  • Mokhtar, I. & N. Salamudin & S.R. Zambahari (2013), “Financial Flexibility and Corporate Performance of Bumiputera Public Listed Companies”, International Conference on Economics and Business Research, 15-16 July, Malaysia.
  • Özel, A.H. & F. Sezgin (2012), “Ticari Serbestleşme-Ekonomik Büyüme İlişkisinin Bootstrap Kantil Regresyon Yardımıyla Analizi”, İktisat Fakültesi Mecmuası, 62(2), 283-303.
  • Pesaran, H. (2004), “General Diagnostic Tests for Cross Section Dependence in Panels”, Cambridge Working Papers in Economics, Working Paper, 435.
  • Rapp, M.S. & T. Schmid & D. Urban (2014), “The value of Financial Flexibility and Corporate Financial Policy”, Journal of Corporate Finance, 29, 288-302.
  • Waghmare, P. & C. Jacksone & J. Poulose & P. Krishnan & S. Mundeja & V. Deep & V. Singh (2011), “An Empirical Study of Factors that Influence Financial Flexibility”, Financial Structure and Financial Performance of a Firm, <https://scholar.google.com/scholar?hl=tr&as_sdt=0%2C5&q=An+Empirical+Study+of+factors+that+influence+Financial+Flexibility%2C+Financial+Structure+and+Financial+Performance+of+a+Firm&btnG=>, 23.11.2020.

Details

Primary Language Turkish
Subjects Economics
Journal Section Articles
Authors

Emre Esat TOPALOĞLU (Primary Author)
Finans ABD
0000-0001-8771-779X
Türkiye


İlhan EGE
MERSİN ÜNİVERSİTESİ
0000-0002-5765-1926
Türkiye

Publication Date July 30, 2021
Published in Issue Year 2021, Volume 29, Issue 49

Cite

Bibtex @research article { sosyoekonomi841166, journal = {Sosyoekonomi}, issn = {1305-5577}, address = {}, publisher = {Sosyoekonomi Society}, year = {2021}, volume = {29}, pages = {409 - 425}, doi = {10.17233/sosyoekonomi.2021.03.21}, title = {Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı}, key = {cite}, author = {Topaloğlu, Emre Esat and Ege, İlhan} }
APA Topaloğlu, E. E. & Ege, İ. (2021). Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı . Sosyoekonomi , 29 (49) , 409-425 . DOI: 10.17233/sosyoekonomi.2021.03.21
MLA Topaloğlu, E. E. , Ege, İ. "Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı" . Sosyoekonomi 29 (2021 ): 409-425 <https://dergipark.org.tr/en/pub/sosyoekonomi/issue/64335/841166>
Chicago Topaloğlu, E. E. , Ege, İ. "Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı". Sosyoekonomi 29 (2021 ): 409-425
RIS TY - JOUR T1 - Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı AU - Emre Esat Topaloğlu , İlhan Ege Y1 - 2021 PY - 2021 N1 - doi: 10.17233/sosyoekonomi.2021.03.21 DO - 10.17233/sosyoekonomi.2021.03.21 T2 - Sosyoekonomi JF - Journal JO - JOR SP - 409 EP - 425 VL - 29 IS - 49 SN - 1305-5577- M3 - doi: 10.17233/sosyoekonomi.2021.03.21 UR - https://doi.org/10.17233/sosyoekonomi.2021.03.21 Y2 - 2021 ER -
EndNote %0 Sosyoekonomi Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı %A Emre Esat Topaloğlu , İlhan Ege %T Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı %D 2021 %J Sosyoekonomi %P 1305-5577- %V 29 %N 49 %R doi: 10.17233/sosyoekonomi.2021.03.21 %U 10.17233/sosyoekonomi.2021.03.21
ISNAD Topaloğlu, Emre Esat , Ege, İlhan . "Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı". Sosyoekonomi 29 / 49 (July 2021): 409-425 . https://doi.org/10.17233/sosyoekonomi.2021.03.21
AMA Topaloğlu E. E. , Ege İ. Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı. Sosyoekonomi. 2021; 29(49): 409-425.
Vancouver Topaloğlu E. E. , Ege İ. Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı. Sosyoekonomi. 2021; 29(49): 409-425.
IEEE E. E. Topaloğlu and İ. Ege , "Finansal Esneklik, Firma Değeri ve Finansal Performans İlişkisi: İnşaat Sektörü Üzerine Panel Kantil Regresyon Yaklaşımı", Sosyoekonomi, vol. 29, no. 49, pp. 409-425, Jul. 2021, doi:10.17233/sosyoekonomi.2021.03.21