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Impact of Intellectual Capital and Risk Attitude Through Financial Literacy on Business Sustainability in Indonesia Batik Smes

Author

Listed:
  • Idris Ahmad

    (Universitas Muhammadiyah Yogyakarta, Yogyakarta, Indonesia.)

  • Hanafi Mamduh M.

    (Universitas Gadjah Mada, Yogyakarta, Indonesia.)

  • Rahmawati Alni

    (Universitas Muhammadiyah Yogyakarta, Yogyakarta, Indonesia.)

  • Surwanti Arni

    (Universitas Muhammadiyah Yogyakarta, Yogyakarta, Indonesia.)

Abstract

This study aims to create a theoretical model of business sustainability with financial literacy antecedents. The antecedents of financial literacy are intellectual capital and risk attitudes. The research location is in the province of East Java, Indonesia. Batik SMEs are only found in Indonesia because it is a cultural heritage belonging to Indonesia that does not exist in other countries. The sampling technique used was purposive sampling, with 222 respondents from the batik SMEs spread across six cities. The data was taken using a questionnaire on a Likert scale. Data analysis uses SEM (structural equation modeling) with the SmartPLS application. The study results show that risk attitudes toward financial literacy have a positive effect. The effect of financial literacy on the business sustainability of the batik industry has a positive influence. The impact of intellectual capital on the business sustainability of the batik industry has a positive effect. Risk attitudes have no significant positive impact on business sustainability. Financial literacy has yet to be able to mediate intellectual capital’s influence on the batik SME’s business sustainability. This needs to be explored further with further research. Furthermore, financial literacy can mediate risk attitudes towards the business sustainability of batik SMEs.

Suggested Citation

  • Idris Ahmad & Hanafi Mamduh M. & Rahmawati Alni & Surwanti Arni, 2023. "Impact of Intellectual Capital and Risk Attitude Through Financial Literacy on Business Sustainability in Indonesia Batik Smes," Economics, Sciendo, vol. 11(2), pages 113-136, December.
    • Handle: RePEc:vrs:econom:v:11:y:2023:i:2:p:113-136:n:1
    DOI: 10.2478/eoik-2023-0052
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    References listed on IDEAS

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    1. Carlos M Jardon, 2015. "The use of intellectual capital to obtain competitive advantages in regional small and medium enterprises," Knowledge Management Research & Practice, Taylor & Francis Journals, vol. 13(4), pages 486-496, November.
    2. Sinta Aryani & Sudarso Kaderi Wiryono & Deddy P. Koesrindartoto & Prameshwara Anggahegari, 2020. "Global competition strategies for Indonesian SMEs," International Journal of Entrepreneurial Venturing, Inderscience Enterprises Ltd, vol. 12(4), pages 395-419.
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      More about this item

      Keywords

      Financial literacy; business sustainability; intellectual capital; risk attitudes; batik SMEs;
      All these keywords.

      JEL classification:

      • G53 - Financial Economics - - Household Finance - - - Financial Literacy
      • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
      • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
      • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth

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