Investment and Financing Constraints: A Switching Regression Approach Using U.S. Firm Panel Data

Fabio Schiantarelli and Xiaoqiang Hu
Additional contact information
Xiaoqiang Hu: Claremont McKenna College

No 284., Boston College Working Papers in Economics from Boston College Department of Economics

Abstract: In this paper we develop a switching regression model of investment, in which the probability of a firm being financially constrained 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. The empirical results obtained for US panel data suggest that the probability of being constrained depends upon variables that capture each firm's credit worthiness, and it is also related to general macroeconomic conditions and to the tightness of monetary policy.

Date: 1994-05
References: Add references at CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://fmwww.bc.edu/EC-P/wp284.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:boc:bocoec:284

Access Statistics for this paper

More papers in Boston College Working Papers in Economics from Boston College Department of Economics Boston College, 140 Commonwealth Avenue, Chestnut Hill MA 02467 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Christopher F Baum ().