Journal of Economics and Management Sciences

Efficiency at the Core: How Working Capital Management Relates to Accounting Metrics and Market Performance in the Automotive Industry

Zaheda Daruwala — 2025-08-19

In today’s volatile automotive landscape, working capital management (WCM) functions not just as a back-office efficiency tool, but a strategic lever for financial and shareholder value. This study explores the relationship between WCM components and firm performance both from accounting and market valuation perspectives. It uses a panel dataset of the top ten publicly listed global automotive firms across multiple geographies over a ten-year period. Firm performance is assessed using accounting indicators of Return on Assets (ROA) and Return on Equity (ROE), and market valuation through Tobin’s Q (TOBQ). The analysis focuses on four WCM components: cash conversion cycle (CCC), average receivables days (ARD), average payables days (APD), and inventory days (ITD), employing multiple linear regression (MLR) for empirical testing. The results reveal that ARD and APD are the most influential components. ARD negatively affects both ROA and ROE, while APD has a positive impact, indicating that efficient receivables collection and extended payable terms improve profitability. ITD and CCC were found to be statistically insignificant in accounting performance models. In contrast, TOBQ is negatively affected by both ARD and CCC, implying that longer receivables periods and cash cycles diminish market valuation by heightening liquidity risk and financial leverage. Notably, ROA and not ROE, emerged as a significant predictor of TOBQ, reinforcing the view that operational efficiency, rather than equity-based returns, is more valued by investors. This research adds to the literature by quantifying the dual impact of WCM on internal performance and external valuation in a capital-intensive industry. Although centered on the automotive sector, the findings may be cautiously generalized to other manufacturing industries with similar operational frameworks. The study underscores WCM’s strategic importance as a lever for both internal performance enhancement and external value creation. Our findings offer actionable insights for operational managers and policymakers, emphasizing the need for optimized capital strategies that bridge operational finance and market performance for enhancing shareholder value.

Innovation Spillovers from Core Enterprises' Digital Transformation: Evidence from Client-Supplier Relationships

Yun Yun Zhao — 2025-09-08

Drawing upon supply chain data from Shanghai and Shenzhen A-share listed companies between 2007 and 2022, this study examines the impact of core enterprises' digital transformation on suppliers' innovation. Findings reveal that digital transformation in core enterprises stimulates suppliers' innovation, with a stronger effect on substantive innovation than on strategic innovation. Mechanism analysis indicates that core enterprises' digital transformation primarily drives supplier innovation through financial spillovers, knowledge spillovers, and innovation facilitation. Heterogeneity analysis reveals that the promotional effect is more pronounced when client-supplier relationship dependency is low, suppliers operate in high-tech industries, and suppliers are non-state-owned enterprises. Adopting a supply chain perspective, this study refines the existing research on client enterprises' digital transformation influencing supplier innovation, offering insights for advancing corporate innovation and fostering collaborative innovation within supply chains.

Research on International Trade of Agricultural Products and Rural Development Path in China

Tiantian Wang — 2025-09-09

This paper focuses on the interactive relationship between China's agricultural products international trade and rural development, aiming to clarify the impact of agricultural trade on rural areas and explore feasible rural development paths under the background of globalization. By adopting research methods such as literature review, case analysis and data statistical analysis, the study first sorts out the relevant theories of agricultural products international trade, including the application of comparative advantage theory and factor endowment theory in China's agricultural trade. Then, it analyzes the current situation of China's agricultural products international trade from the aspects of trade scale, trade structure and main trading partners. On this basis, the paper deeply discusses the economic, social and environmental impacts of agricultural products international trade on rural development. For example, it promotes farmers' income growth and industrial structure adjustment economically, increases employment opportunities and improves farmers' quality socially, while promoting green agriculture development and bringing potential environmental challenges environmentally.

Attracting Foreign Investment and Its Influence on Outward Investment in Developing Countries: An Empirical Analysis Based on China's Reform and Opening-up Experience

Yudi Cheng — 2025-09-09

This paper aims to explore whether attracting foreign investment promotes outward foreign investment in developing countries, taking China’s experience during its reform and opening-up as a typical case.By leveraging panel data encompassing 31 provinces (municipalities) across China spanning the period from 2007 to 2022, it employs empirical methods to examine FDI’s impact on OFDI. The results show that: 1) FDI generally enhances provincial OFDI regardless of control variables and fixed effects; 2) regional heterogeneity exists—FDI inhibits OFDI in eastern and central regions but promotes it in western China; 3) government incentive policies are closely associated with OFDI’s formation and growth. The study provides empirical evidence for developing countries to optimize their open development paths.