Investment And Capital Market Imperfections: A Switching Regression Approach Using U.S. Firm Panel Data
Xiaoqiang Hu and
Fabio Schiantarelli
The Review of Economics and Statistics, 1998, vol. 80, issue 3, 466-479
Abstract:
In this paper we develop a switching regression model of investment, in which the probability of a firm facing a high premium on external finance is endogenously determined. This approach allows one to address the potential problem of static and dynamic misclassification encountered where firms are sorted using a criteria chosen a priori. We use U.S. firm level data to analyze the effects of variables that capture each firm's credit worthiness, asymmetric information, and agency problems on the probability of being in the high- or low-premium regime. The role of macroeconomic conditions and monetary policy is also discussed. © 1998 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology
Date: 1998
References: Add references at CitEc
Citations: View citations in EconPapers (134)
Downloads: (external link)
http://www.mitpressjournals.org/doi/pdf/10.1162/003465398557564 (application/pdf)
Access to full text is restricted to subscribers.
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:tpr:restat:v:80:y:1998:i:3:p:466-479
Ordering information: This journal article can be ordered from
https://mitpressjour ... rnal/?issn=0034-6535
Access Statistics for this article
The Review of Economics and Statistics is currently edited by Pierre Azoulay, Olivier Coibion, Will Dobbie, Raymond Fisman, Benjamin R. Handel, Brian A. Jacob, Kareen Rozen, Xiaoxia Shi, Tavneet Suri and Yi Xu
More articles in The Review of Economics and Statistics from MIT Press
Bibliographic data for series maintained by The MIT Press ().