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flows to fund investment), and that the sensitivity of investment to internal cash flows is higher for firms that report …
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Do firms use credit line drawdowns to finance investment? Using a unique dataset of 467 COMPUSTAT firms with credit … with theory, our results confirm that firms use drawdowns to sustain investment after an idiosyncratic liquidity shock … investment increased to 16 percent. The effect was even larger for smaller and financially constrained firms. We find only …
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