Cash flow sensitivity of investment: Evidence from the Polish listed companies

Nehrebecki Marian ()
Additional contact information
Nehrebecki Marian: Faculty of Economic Sciences, University of Warsaw

Central European Economic Journal, 2020, vol. 7, issue 54, 157-171

Abstract: The paper focuses on assessment of the sensitivity of investment on cash flow (ICFS) made by listed companies in Poland. Achieving this goal will also involve analysing and drawing conclusions about the balance-sheet channel of monetary transmission. An empirical part uses data from financial statements for Poland derived from Emerging Markets Information Services (EMIS), related to companies listed on the Warsaw Stock Exchange and NewConnect. Estimations were made using the Ordinary Least Squares method with robust standard errors, and results made it clear that cash flow has a positive significant impact, indicating that most companies operate on the imperfect and incomplete market, and with constrained or costly access to external financing. Further, it is found that the impact is significantly strong in the slowdown, as financial constraints are more binding. These results seem to confirm that the balance-sheet channel of monetary transmission is operative in Poland.

Keywords: investment; cash flow; ICFS; balance sheet channel; financial accelerator (search for similar items in EconPapers)
JEL-codes: C33 E22 E44 (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.2478/ceej-2020-0009 (text/html)

Related works:
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: https://EconPapers.repec.org/RePEc:vrs:ceuecj:v:7:y:2020:i:54:p:157-171:n:4

DOI: 10.2478/ceej-2020-0009

Access Statistics for this article

Central European Economic Journal is currently edited by Anna Matysiak

More articles in Central European Economic Journal from Sciendo
Bibliographic data for series maintained by Peter Golla ().