Exchange Rate, Marginal q and Investment Behavior of Small and Medium-Sized Enterprises in Japan: Time Series Evidences of Manufacturing Industries

Masafumi Kozuka ()
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Masafumi Kozuka: Graduate School of Economics, Kobe University

No 1515, Discussion Papers from Graduate School of Economics, Kobe University

Abstract: In this paper, we investigate Granger fs causality among the exchange rate, Tobin fs marginal q, and investment-capital ratio with quarterly data on firms categorized small and medium-sized enterprises (SMEs) in Japan. We utilize the data of following industries: chemical, iron and steel, production machinery, electric machinery and equipment, automobile and accessories and all manufacturing. The empirical results we obtain show that the null hypotheses of no Granger fs causality from the exchange rate to other variables, investment and marginal q, are accepted in all industries. The reason is the lower percentage of export by SMEs. Thus, it is considered that the effects of Abenomics on SMEs are limited, and that other kinds of reflation measures for SMEs are needed.

Keywords: marginal q; small and medium-sized enterprises; LA-VAR model; irreversibility; exchange rate (search for similar items in EconPapers)
JEL-codes: C32 F22 (search for similar items in EconPapers)
Pages: 11 pages
Date: 2015-03
New Economics Papers: this item is included in nep-cse, nep-ent and nep-sbm
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