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relationship between investment activity and financial constraints is theoretically ambivalent due to simultaneity, the link … take longer to close capacity gaps. This indicates that financial constraints do indeed play a part in the investment …
Persistent link: https://www.econbiz.de/10010295669
Following a positive shock, financing constraints will prolong or impede economic expansion that would have been optimal in an unconstrained environment. The study of dynamic adjustment therefore offers a direct way of verifying the presence of financing constraints and assessing their...
Persistent link: https://www.econbiz.de/10010295882
Applications tend to ignore that measured TFP reflects the variation of output that cannot be explained by changes in inputs. Such a change is not necessarily technological, so measured TFP differences across firms are an amalgam of technological, efficiency and other differences in attributes,...
Persistent link: https://www.econbiz.de/10010322437
This paper analyses the interplay of capacity utilisation, capacity constraints, demand constraints and price adjustments, employing a unique firm-level data set for Swiss manufacturing firms. Theoretically, capacity constraints limit the ability of firms to expand production in the short run...
Persistent link: https://www.econbiz.de/10010285797
Uncertainty about the level of demand is thought to influence irreversible capacity decisions. This paper examines some implications of the theory literature on this topic in an empirical study of the US cement industry between 1994 and 2006. Firms in this sector have the ability to deliver...
Persistent link: https://www.econbiz.de/10010274906
related to the level of investment in irrigation capacity and the other one to the irrigation level in each period. In the … period. Assuming a CARA utility function, we show that taxing the investment may entail an increase in preventive irrigation … although the investment decreases. Moreover, in the case of a logistic production function, the total water use is non …
Persistent link: https://www.econbiz.de/10011335744
The paper considers the problem of evaluating the probability of investing in a capital-investment project as a measure … of the uncertainty-investment relationship in a real option model. By the use of the contingent claims analysis the …
Persistent link: https://www.econbiz.de/10011608790
We argue that positive comovements between land prices and business investment are a driving force behind the broad … joint dynamics of land prices and business investment. …
Persistent link: https://www.econbiz.de/10010292308
guarantee existence. When investment adjustment costs are introduced, the monetary and fiscal policy dichotomy is in principle …
Persistent link: https://www.econbiz.de/10010293451
using an empirical example of UK investment data. …
Persistent link: https://www.econbiz.de/10010293709