Dynamic Investment Models and the Firm's Financial Policy.
In this paper, the authors investigate the sensitivity of investment to the availability of internal funds using the hierarchy of finance approach to corporate finance. They characterize the empirical implications of this approach for dynamic investment models and test these implications using firm-level data. The model the authors estimate is based on the Eulet equation for optimal capital accumulation in the presence of convex adjustment costs. The theoretical model explicitly allows for debt finance and financial assets. The empirical investigation uses U.K. company panel data to estimate dynamic investment models using generalized method of moments and tests the derived implications. Copyright 1994 by The Review of Economic Studies Limited.
Year of publication: |
1994
|
---|---|
Authors: | Bond, Stephen ; Meghir, Costas |
Published in: |
Review of Economic Studies. - Wiley Blackwell, ISSN 0034-6527. - Vol. 61.1994, 2, p. 197-222
|
Publisher: |
Wiley Blackwell |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Dynamic investment models and the firm's financial policy
Bond, Stephen, (1990)
-
Dynamic investment models and the firm's financial policy
Bond, Stephen, (1994)
-
Financial constraints and company investment
Bond, Stephen, (1994)
- More ...