Financing Imperfections and the Investments Decisions of Privately Owned Firms

Andrea Caggese

No 265, Working Papers from Barcelona School of Economics

Abstract: Financing constrains on investment are mainly important for small privately owned firms. Yet most of the investment literature focuses on the financing constraints of large publicly owned firms. This paper develops a financing constraints test based on a variable capital investment equation. Because it does not require the information about marginal q, the test can be easily applied to small firms not quoted on the stock market. Importantly, the test does not rely on restrictive assumptions about the adjustment costs of fixed capital. We confirm empirically the validity of this test on a sample of small manufacturing firms.

Keywords: Financing constraints; investment; Small Firms; Privately Owned Firms; Variable Capital (search for similar items in EconPapers)
JEL-codes: D21 G31 (search for similar items in EconPapers)
Date: 2015-09
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://bw.bse.eu/wp-content/uploads/2021/07/1265-file.pdf (application/pdf)

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:bge:wpaper:265

Access Statistics for this paper

More papers in Working Papers from Barcelona School of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Bruno Guallar ().