Managers of tourism companies can no longer expect any financial support from company owners: different working capital management due to the global financial crisis

Result code in IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F47813059%3A19520%2F20%3AA0000150" target="_blank" >RIV/47813059:19520/20:A0000150 - isvavai.cz</a>

Result on the web

<a href="https://dx.doi.org/10.15240/tul/001/2020-1-004" target="_blank" >https://dx.doi.org/10.15240/tul/001/2020-1-004</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.15240/tul/001/2020-1-004" target="_blank" >10.15240/tul/001/2020-1-004</a>

Result language

angličtina

Original language name

Managers of tourism companies can no longer expect any financial support from company owners: different working capital management due to the global financial crisis

Original language description

Tourism evidence is more and more often among the research literature because of its importance for the economy. Nonetheless, there is still a huge gap in recent literature related to its financial issues, the microeconomics of tourism in other words. This particular paper focuses neither on economic growth, nor the number of arrivals, which is both the most common fields in literature. It focuses on the financial management of middle-sized hotels and travel agencies. The aim of the study is to estimate the relationship between profitability and both, working capital management and reinvestments of companies' owners of medium-sized hotels and travel agencies in the period affected by the global financial crisis. Annual data from two international databases, Amadeus and Orbis, are used to compare differences caused by the global financial crisis and later on, the Euro crisis. Both of these economic events affected even tourism without any doubts. According to a character of variables the General Method of Moments (GMM) with panel data is deployed as the main estimation method. There is an effort made to explain this particular regression method and all reasons for its usage, more importantly, to explain that a reader in a clear way. The results of this study have proven that managers cannot expect any financial support from owners of tourism companies. Even though the owners were obviously distributing the earnings during the crisis period, managers were able to increase the net working capital apparently. Therefore, on the contrary, owners would put the pressure on managers to employ a riskier payment policy of middlesized hotels and travel agencies after the crisis. Tourism evidence is more and more often among the research literature because of its importance for the economy. Nonetheless, there is still a huge gap in recent literature related to its financial issues, the microeconomics of tourism in other words. This particular paper focuses neither on economic growth, nor the number of arrivals, which is both the most common fields in literature. It focuses on the financial management of middle-sized hotels and travel agencies. The aim of the study is to estimate the relationship between profitability and both, working capital management and reinvestments of companies' owners of medium-sized hotels and travel agencies in the period affected by the global financial crisis. Annual data from two international databases, Amadeus and Orbis, are used to compare differences caused by the global financial crisis and later on, the Euro crisis. Both of these economic events affected even tourism without any doubts. According to a character of variables the General Method of Moments (GMM) with panel data is deployed as the main estimation method. There is an effort made to explain this particular regression method and all reasons for its usage, more importantly, to explain that a reader in a clear way. The results of this study have proven that managers cannot expect any financial support from owners of tourism companies. Even though the owners were obviously distributing the earnings during the crisis period, managers were able to increase the net working capital apparently. Therefore, on the contrary, owners would put the pressure on managers to employ a riskier payment policy of middlesized hotels and travel agencies after the crisis.

Czech name

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Czech description

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Type

J_imp - Article in a specialist periodical, which is included in the Web of Science database

CEP classification

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OECD FORD branch

50204 - Business and management

Project

—

Continuities

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Publication year

2020

Confidentiality

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Name of the periodical

E & M EKONOMIE A MANAGEMENT

ISSN

1212-3609

e-ISSN

—

Volume of the periodical

23

Issue of the periodical within the volume

1

Country of publishing house

CZ - CZECH REPUBLIC

Number of pages

10

Pages from-to

50-59

UT code for WoS article

000525736700004

EID of the result in the Scopus database

2-s2.0-85083315648