Financing Constraints and Investment Decline in Mexico

Talan B. Iscan ()

Department of Economics at Dalhousie University working papers archive from Dalhousie, Department of Economics

Abstract: To what extent can financing constraints, which have been so central to foreign debt related explanations of investment decline in heavily indebted economies, account for low investment rates in Mexico after 1982? In order to investigate the implications of financing constraints hypothesis on investment decisions, this study employs a cost-of-adjustment model of investment and annual panel data of Mexican manufacturing industries covering the period 1970 to 1990. It is found that part of the debt crisis effects on investment, identified in the earlier literature, may be due to binding financing constraints in Mexico.

Keywords: debt crisis; financing constraints; investment; Mexican manufacturing industry (search for similar items in EconPapers)
JEL-codes: F31 (search for similar items in EconPapers)
Date: 1998-03-10
View list of references

Downloads: (external link)
http://www.economics.dal.ca/RePEc/dal/wparch/fdis98.pdf (application/pdf)
http://www.economics.dal.ca/RePEc/dal/wparch/fdis98.ps (application/postscript)

Related works:
Journal Article: Financing Constraints and Investment Decline in Mexico (2000)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:dal:wparch:fdis98

Access Statistics for this paper

More papers in Department of Economics at Dalhousie University working papers archive from Dalhousie, Department of Economics
Contact information at EDIRC.
Series data maintained by ().