Financial capital, constraints, partners, and performance: An empirical analysis of Indonesia SMEs

I Wayan Widnyana, I Made Dauh Wijana, Almuntasir Almuntasir

Abstract


Indonesia small and medium enterprises (SMEs) are considered as the backbone of national economy. However, the fact that SME’s still contribute less to the national gross domestic product (GDP) in terms of value added, need to be addressed. While previous studies mainly focused on financial (access) constraint as one of the major constraints that faced by small enterprises which affects their growth and performances, this study aims to extends the relationship between capital and financial performance of Indonesia SMEs with the moderating effect of financial constraints and partners. This study is different from others as it uses bigger panel dataset which is about 4.36 million SMEs in Indonesia, and is the first to explore the role of financial partners comprehensively. Moreover, panel regression model with geographic analysis unit uses as data analysis method. The results of the study show that financial capital has a positive and significant effect on financial performance of SMEs. Furthermore, while the moderation role of financial partner on the relationship between financial capital and financial performance of Indonesia SMEs was failed to prove, the negative moderation effect of financial constraints were able to prove in this study.

Keywords


Small and Medium Enterprises; SME; Financial Performance; Capital; Financial Constraints; Financial Partners



DOI: http://dx.doi.org/10.31106/jema.v18i2.11318

Refbacks

  • There are currently no refbacks.


Copyright (c) 2021 JEMA: Jurnal Ilmiah Bidang Akuntansi dan Manajemen

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

JEMA: Jurnal Ilmiah Bidang Akuntansi dan Manajemen is indexed by:

        

JEMA: Jurnal Ilmiah Bidang Akuntansi dan Manajemen also registered in ICI (Index Copernicus International) as N/I Journal

 

Creative Commons License
JEMA: Jurnal Ilmiah Bidang Akuntansi dan Manajemen is licensed under a Creative Commons Attribution 4.0 International License