THE INTERRELATIONSHIP OF WORKING CAPITAL: THE ROLE OF FINANCIAL BOOTSTRAPPING AND GOVERNMENT SUPPORT

Maria Rio Rita; Supramono; Theresia Woro Damayanti; Pambayun Kinashin Yekti Nastiti

Authors

Maria Rio Rita Satya Wacana Christian University, Indonesia https://orcid.org/0000-0003-2232-5132
Supramono Satya Wacana Christian University, Indonesia https://orcid.org/0000-0002-2110-0671
Theresia Woro Damayanti Satya Wacana Christian University, Indonesia https://orcid.org/0000-0002-4065-3562
Pambayun Kinashin Yekti Nastiti Satya Wacana Christian University, Indonesia https://orcid.org/0000-0002-0210-7798

Keywords:

Financial Performance, Working Capital, Entrepreneurial Orientation, Financial Bootstrapping, Government Support

Abstract

This study aims to investigate the effects of financial bootstrapping and government support on working capital, as well as the moderating role of entrepreneurial orientation towards the impact of working capital on financial performance. The study was conducted on 260 MSME owners in the food and beverage sector in Semarang, Surakarta, and Salatiga, in Central Java Province, Indonesia. By using a Partial Least Squares-Structural Equation Modeling (PLS-SEM) analysis, the determinant effects and consequences of working capital were determined. The findings of this study indicate that financial bootstrapping and government support are proven to have a significant positive effect on working capital. Working capital has a significant positive effect on financial performance, but entrepreneurial orientation is not confirmed to moderate the effect of working capital on financial performance.

THE INTERRELATIONSHIP OF WORKING CAPITAL

THE ROLE OF FINANCIAL BOOTSTRAPPING AND GOVERNMENT SUPPORT

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