Effects of capital investment on working capital management: Evidence on Tunisian export small and medium enterprises (SMEs)

The main objective of this study is to investigate empirically the impact of companiesʹ capital investment on working capital management. For this purpose, data of 386 small and medium companies were collected from the Tunisian Export Center over the period 2001 to 2008. Capital, financial and operating expenditures are principally used to explain working capital management measured by net liquidity balance and working capital requirement. The statistical analyses included descriptive statistics and regressions on panel data. The findings indicate that net liquidity balance and working capital requirement have respectively positive and negative relationship with companiesʹ capital investment.