Subsidies and Economic and Financial Performance of Enterprises

The aim of this article is to analyze the economic and financial performance of Slovenian enterprises, as a European Union (EU) member state case study. A favorable economic and financial performance is crucial for long-term sustainable enterprise growth and survival. Eight economic and financial pe...

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Autores principales:	Štefan Bojnec, Sabina Žampa
Formato:	article
Lenguaje:	EN
Publicado:	MDPI AG 2021
Materias:	economic performance financial performance economic indicator financial indicators enterprises sustainable growth Risk in industry. Risk management HD61 Finance HG1-9999
Acceso en línea:	https://doaj.org/article/b19f2801a99c4f5b8cabf51418d98f65
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spelling	oai:doaj.org-article:b19f2801a99c4f5b8cabf51418d98f652021-11-25T18:08:21ZSubsidies and Economic and Financial Performance of Enterprises10.3390/jrfm141105051911-80741911-8066https://doaj.org/article/b19f2801a99c4f5b8cabf51418d98f652021-10-01T00:00:00Zhttps://www.mdpi.com/1911-8074/14/11/505https://doaj.org/toc/1911-8066https://doaj.org/toc/1911-8074The aim of this article is to analyze the economic and financial performance of Slovenian enterprises, as a European Union (EU) member state case study. A favorable economic and financial performance is crucial for long-term sustainable enterprise growth and survival. Eight economic and financial performance indicators are used to evaluate the sustainability in the growth of enterprises: seven of them are financial indicators—assets, revenues from sales, equity, net profits, operating efficiency, return on equity, and value added per employee—while the eighth variable is the economic indicator for the number of employees. A distinction is made between enterprises that did and that did not receive subsidies from national and EU funds. Three enterprise-level data sources are combined in the empirical analysis: balance sheet data from enterprise accounts, own surveys data, and government data on public subsidies to enterprises. The mean values and standard deviations of economic and financial indicators based on balance sheet data for the years in two financial periods are estimated. The summary statistics for economic and financial indicators and correlation analysis are conducted and the results of the economic and financial indicators are compared using the parametric paired sample two-tailed t-test that allows comparison between the enterprises in the two financial periods. An increase in the economic and financial indicators is investigated by comparing the enterprises that did receive subsidies with the enterprises that did not receive subsidies in the two financial periods. The empirical results confirm that the value added per employee is the only financial indicator where a positive link is found between the financial indicator and subsidies. The results suggest that subsidies can be important for cash flow into enterprises, but entrepreneurial activities are crucial for favorable economic and financial performance and long-term sustainable growth in a competitive market environment.Štefan BojnecSabina ŽampaMDPI AGarticleeconomic performancefinancial performanceeconomic indicatorfinancial indicatorsenterprisessustainable growthRisk in industry. Risk managementHD61FinanceHG1-9999ENJournal of Risk and Financial Management, Vol 14, Iss 505, p 505 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	economic performance financial performance economic indicator financial indicators enterprises sustainable growth Risk in industry. Risk management HD61 Finance HG1-9999
spellingShingle	economic performance financial performance economic indicator financial indicators enterprises sustainable growth Risk in industry. Risk management HD61 Finance HG1-9999 Štefan Bojnec Sabina Žampa Subsidies and Economic and Financial Performance of Enterprises
description	The aim of this article is to analyze the economic and financial performance of Slovenian enterprises, as a European Union (EU) member state case study. A favorable economic and financial performance is crucial for long-term sustainable enterprise growth and survival. Eight economic and financial performance indicators are used to evaluate the sustainability in the growth of enterprises: seven of them are financial indicators—assets, revenues from sales, equity, net profits, operating efficiency, return on equity, and value added per employee—while the eighth variable is the economic indicator for the number of employees. A distinction is made between enterprises that did and that did not receive subsidies from national and EU funds. Three enterprise-level data sources are combined in the empirical analysis: balance sheet data from enterprise accounts, own surveys data, and government data on public subsidies to enterprises. The mean values and standard deviations of economic and financial indicators based on balance sheet data for the years in two financial periods are estimated. The summary statistics for economic and financial indicators and correlation analysis are conducted and the results of the economic and financial indicators are compared using the parametric paired sample two-tailed t-test that allows comparison between the enterprises in the two financial periods. An increase in the economic and financial indicators is investigated by comparing the enterprises that did receive subsidies with the enterprises that did not receive subsidies in the two financial periods. The empirical results confirm that the value added per employee is the only financial indicator where a positive link is found between the financial indicator and subsidies. The results suggest that subsidies can be important for cash flow into enterprises, but entrepreneurial activities are crucial for favorable economic and financial performance and long-term sustainable growth in a competitive market environment.
format	article
author	Štefan Bojnec Sabina Žampa
author_facet	Štefan Bojnec Sabina Žampa
author_sort	Štefan Bojnec
title	Subsidies and Economic and Financial Performance of Enterprises
title_short	Subsidies and Economic and Financial Performance of Enterprises
title_full	Subsidies and Economic and Financial Performance of Enterprises
title_fullStr	Subsidies and Economic and Financial Performance of Enterprises
title_full_unstemmed	Subsidies and Economic and Financial Performance of Enterprises
title_sort	subsidies and economic and financial performance of enterprises
publisher	MDPI AG
publishDate	2021
url	https://doaj.org/article/b19f2801a99c4f5b8cabf51418d98f65
work_keys_str_mv	AT stefanbojnec subsidiesandeconomicandfinancialperformanceofenterprises AT sabinazampa subsidiesandeconomicandfinancialperformanceofenterprises
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Subsidies and Economic and Financial Performance of Enterprises

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