EPU and SMEs' financial performance: Industry vs. service sector

The objective of this paper is to analyze the Economic Policy Uncertainty impact on Small and Medium Enterprises’ financial performance, considering the role that sector plays and firm characteristics. Thus, a data sample of 80,620 Spanish SMEs was selected for 2012–2020. Using system Generalized Me...

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Detalles Bibliográficos
Autores: Orden-Cruz, Carmen, Paule-Vianez, Jessica, Sánchez-Escobedo, Mari Cruz, Moutinho, Víctor
Tipo de recurso: artículo
Fecha de publicación:2024
País:España
Institución:Universidad Rey Juan Carlos
Repositorio:BURJC-Digital. Repositorio Institucional de la Universidad Rey Juan Carlos
OAI Identifier:oai:burjcdigital.urjc.es:10115/34955
Acceso en línea:https://hdl.handle.net/10115/34955
Access Level:acceso abierto
Palabra clave:Economic policy uncertainty
Financial performance
Small and medium enterprises
Firm characteristics
Sector
Descripción
Sumario:The objective of this paper is to analyze the Economic Policy Uncertainty impact on Small and Medium Enterprises’ financial performance, considering the role that sector plays and firm characteristics. Thus, a data sample of 80,620 Spanish SMEs was selected for 2012–2020. Using system Generalized Method of Moments estimators, the results show a negative impact, especially in the service sector. Industrial Spanish SMEs that are larger, younger, more indebted, with more growth opportunities and with higher asset turnover are the most resilient to EPU. The findings can help SMEs design better management strategies to deal with this uncertainty