Conceptual review study of working capital management practices in the construction industry: trends and research prospects in Ghana

Abstract

Purpose

The concept of working capital management (WCM) has been a fundamental financial accounting term that has evolved in financial theory for centuries. Given that the construction industry (CI) is financially dynamic, there is an imperative need to understand its WCM practices. The call for the industry players to adhere to efficient financial management practices as a result of a huge financing gap requires consented effort. This study aims to explore the trend of practices of WCM in the CI and elicit a broader polemic dialogue about this crucial theme.

Design/methodology/approach

The source of information for the study was secondary mainly from referenced journals and international conference papers published on WCM relating to the CI. A three-step sample selection strategy was adopted to identify the range and scope of publications on WCM in the CI based on the systematic literature review method.

Findings

The CI cannot boost of enough empirical WCM research to gain in-depth understanding of its practical trend. The developing economies are failing to produce insightful peer-reviewed papers on WCM to assist in bridging the infrastructural financing gap through apposite strategies. Gaining appropriate knowledge of the short-term financial operations through a conceptualization of WCM practices in the CI may lead to better strategies formulated for smooth operations.

Originality/value

This is a pioneering paper in developing economies that have taken stock of WCM knowledge of the practical trend in the CI. Future research prospects in which WCM matters can use it as a reference point.

Citation

Asare, E., Owusu-Manu, D.-G., Ayarkwa, J. and Edwards, D.J. (2024), "Conceptual review study of working capital management practices in the construction industry: trends and research prospects in Ghana", Journal of Engineering, Design and Technology, Vol. 22 No. 4, pp. 1082-1098. https://doi.org/10.1108/JEDT-01-2022-0017