Macroeconomic factors, firm characteristics and financial performance: A study of selected quoted manufacturing firms in Nigeria
Chinedu Francis Egbunike,Chinedu Uchenna Okerekeoti +1 more
- Vol. 3, Iss: 2, pp 142-168
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TLDR
In this paper, the authors explored the interrelationship between macroeconomic factors, firm characteristics and financial performance of quoted manufacturing firms in Nigeria and found no significant effect for interest rate, inflation rate, exchange rate and gross domestic product (GDP) growth rate, while the firm characteristics were size, leverage and liquidity.Abstract:
Purpose
The purpose of this paper is to explore the interrelationship between macroeconomic factors, firm characteristics and financial performance of quoted manufacturing firms in Nigeria. Specifically, the study investigates the effect of interest rate, inflation rate, exchange rate and the gross domestic product (GDP) growth rate, while the firm characteristics were size, leverage and liquidity. The dependent variable financial performance is measured as return on assets (ROA).
Design/methodology/approach
The study used the ex post facto research design. The population comprised all quoted manufacturing firms on the Nigerian Stock Exchange. The sample was restricted to companies in the consumer goods sector, selected using non-probability sampling method. The study used multiple linear regression as the method of validating the hypotheses.
Findings
The study finds no significant effect for interest rate and exchange rate, but a significant effect for inflation rate and GDP growth rate on ROA. Second, the firm characteristics showed that firm size, leverage and liquidity were significant.
Practical implications
The study has implications for regulators and policy makers in formulating policy decisions. In addition, managers may better understand the interplay between macroeconomic factors, firm characteristics and profitability of firms.
Originality/value
Few studies have addressed the interplay of macroeconomic factors and firm characteristics in determining the profitability of manufacturing firms in the country and developing countries in general.read more
Citations
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References
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Firm Resources and Sustained Competitive Advantage
TL;DR: In this article, the authors examined the link between firm resources and sustained competitive advantage and analyzed the potential of several firm resources for generating sustained competitive advantages, including value, rareness, imitability, and substitutability.
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Multivariate Data Analysis
TL;DR: In this paper, a six-step framework for organizing and discussing multivariate data analysis techniques with flowcharts for each is presented, focusing on the use of each technique, rather than its mathematical derivation.
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Multivariate data analysis
TL;DR: This chapter discusses Structural Equation Modeling: An Introduction, and SEM: Confirmatory Factor Analysis, and Testing A Structural Model, which shows how the model can be modified for different data types.
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Educational research, an introduction
Walter R. Borg,Meredith D. Gall +1 more
TL;DR: A systematic review of research methods and techniques used in qualitative and quantitative education, and some of the approaches taken, found that qualitative research is more effective than quantitative research on a number of fronts.
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