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Panel data analysis applied in financial performance assessment

Author

Listed:
  • Elisabeta JABA

    (Alexandru Ioan Cuza University of Iasi, Romania)

  • Ioan-Bogdan ROBU

    (Alexandru Ioan Cuza University of Iasi, Romania)

  • Christiana Brigitte BALAN

    (Alexandru Ioan Cuza University of Iasi, Romania)

Abstract

This paper aims to present the use of panel data analysis in order to assess the state and dynamics of financial performance of the companies listed on the Bucharest Stock Exchange under the influence of determinant factors. Financial performance may be assessed by means of return on equity – ROE. Its main determinant factors suggested by literature are return on assets – ROA and own or financial leverage (FL). This paper provides a theoretical background and applied panel data analysis of two case studies that use fixed and random-effects models (investigating the influence of ROE of previous period on ROE for the current period). The selection of one of the two types of models is based on the results obtained by applying the Hausman test. The study includes Romanian companies listed on Bucharest Stock Exchange (BSE) during 2006-2015 and uses balanced samples. The authors used SAS 9.2 for data processing.

Suggested Citation

  • Elisabeta JABA & Ioan-Bogdan ROBU & Christiana Brigitte BALAN, 2017. "Panel data analysis applied in financial performance assessment," Romanian Statistical Review, Romanian Statistical Review, vol. 65(2), pages 3-20, June.
    • Handle: RePEc:rsr:journl:v:65:y:2017:i:2:p:3-20
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    References listed on IDEAS

    as
    1. Elisabeta Jaba & Ioan-Bogdan Robu & Costel Istrate & Christiana Brigitte Balan & Mihai Roman, 2016. "Statistical Assessment of the Value Relevance of Financial Information Reported by Romanian Listed Companies," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 27-42, June.
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    Citations

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    Cited by:

    1. ManYing Kang & Marcel Ausloos, 2017. "An Inverse Problem Study: Credit Risk Ratings as a Determinant of Corporate Governance and Capital Structure in Emerging Markets: Evidence from Chinese Listed Companies," Economies, MDPI, vol. 5(4), pages 1-23, November.
    2. Ioan-Bogdan ROBU & Ionut Viorel HERGHILIGIU & Bogdan BUDEANU & Sorin CHIRU, 2019. "Assessing Comparability of Accounting Information Using Panel Data Analysis," The Audit Financiar journal, Chamber of Financial Auditors of Romania, vol. 17(155), pages 441-441.
    3. Rao, Purnima & Goyal, Nisha & Kumar, Satish & Hassan, M. Kabir & Shahimi, Shahida, 2021. "Vulnerability of financial markets in India: The contagious effect of COVID-19," Research in International Business and Finance, Elsevier, vol. 58(C).
    4. ManYing Kang & Marcel Ausloos, 2017. "An Inverse Problem Study: Credit Risk Ratings as a Determinant of Corporate Governance and Capital Structure in Emerging Markets: Evidence from Chinese Listed Companies," Papers 1712.00602, arXiv.org.
    5. Veronika Linhartová & Martina Halásková, 2022. "Determinants of corruption: a panel data analysis of Visegrad countries," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 17(1), pages 51-79, March.

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    More about this item

    Keywords

    panel data analysis; financial performance; return on equity; return on assets; financial leverage;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C58 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Financial Econometrics
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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