We contribute to the financial constraints literature and the investment-cash flow sensitivity debate by defining a new …-level employment growth as a control for investment opportunities, we find that constrained firms display the highest investment …

In this paper we describe a theoretical model of optimal investment of various types of financially constrained firms …. We show that the resulting relationship between internal funds and investment is non-monotonic. In particular, the … magnitude of the cash flow sensitivity of the investment is lower for firms with credit rationing compared to firms that are …

dynamic investment model, in which the upper bound on investment is introduced. The limit of the investment enables to analyse … the consequence of the occurrence of credit rationing on farmer's capital accumulation, investment and supply. The method … to the initial bound on investment, the parameter of the cost function, the price, the level of technology and the …