Determinants of Working Capital Management of Companies in Agriculture in the Czech Republic

Markéta SkupieňováIvana Koštuříková

DOI 10.7160/aol.2025.170307
No 3/2025, September
pp. 73-87

Skupieňová, M. and Koštuříková, I. (2025) "Determinants of Working Capital Management of Companies in Agriculture in the Czech Republic", AGRIS on-line Papers in Economics and Informatics, Vol. 17, No. 3, pp. 73-87. ISSN 1804-1930. DOI 10.7160/aol.2025.170307.

Abstract

The aim of the article is to evaluate determinants of working capital investment policy of companies in agriculture in the Czech Republic from 2013 to 2022. The aim of this article is to identify the main determinants that influence the management of working capital in agricultural enterprises in the Czech Republic and to analyze how these factors affect the operational efficiency and financial stability of these enterprises from 2013 to 2022. Comparative analysis, Granger causality test and generalized method of moments (GMM method) will be used to identify the determinants of working capital. The data base includes 2 516 enterprises operating in agriculture in the Czech Republic. The results showed that the agricultural sector has a relaxed investment policy with a high share of inventories, while in recent years there has been a positive improvement in the effectiveness of working capital management. This policy is significantly influenced by company size, growth opportunities and capital structure. The improvement in return on assets and equity contributed to better financial stability. Companies can optimize their investment policy and improve financial results through better analysis of these factors.

Keywords

Assets structure, capital structure, GMM method, growth opportunities, return on equity, size of the company, working capital investment policy.

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