HERYÁN, Tomáš. Managers of tourism companies can no longer expect any financial support from company owners: different working capital management due to the global financial crisis. E & M EKONOMIE A MANAGEMENT. LIBEREC 1: TECHNICAL UNIV LIBEREC, 2020, vol. 23, No 1, p. 50-59. ISSN 1212-3609. doi:10.15240/tul/001/2020-1-004.
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Basic information
Original 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
Authors HERYÁN, Tomáš (203 Czech Republic, guarantor, belonging to the institution).
Edition E & M EKONOMIE A MANAGEMENT, LIBEREC 1, TECHNICAL UNIV LIBEREC, 2020, 1212-3609.
Other information
Original language English
Type of outcome Article in a journal
Field of Study 50204 Business and management
Country of publisher Czech Republic
Confidentiality degree is not subject to a state or trade secret
WWW URL
RIV identification code RIV/47813059:19520/20:A0000150
Organization unit School of Business Administration in Karvina
Doi http://dx.doi.org/10.15240/tul/001/2020-1-004
UT WoS 000525736700004
Keywords in English Tourism; hotels and travel agencies; financial health; GMM estimation
Tags financial management, tourism
Tags International impact, Reviewed
Changed by Changed by: Ing. Tomáš Heryán, Ph.D., učo 16183. Changed: 10/12/2020 10:43.
Abstract
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.
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