Investissement et contraintes de financement: le poids du cycle. Une estimation sur données françaises

Bruno Crépon and Fabienne Rosenwald
Additional contact information
Bruno Crépon: INSEE - Institut national de la statistique et des études économiques (INSEE)
Fabienne Rosenwald: ENSAE - Ecole Nationale de la Statistique et de l'Analyse Economique - Ecole Nationale de la Statistique et de l'Analyse Economique

Working Papers from HAL

Abstract: In this paper we study the influence of financial constraints on the investment behavior of French firms by estimating the Euler equation for investment on a large panel of firms over the period 1986-1994. In particular we emphasize the impact of the firm's level of collateral on its external financial cost. We assume that the rate at which the firm can borrow is linked to the firm's debt to tangible fixed assets ratio through a premium added to the safe interest rate. We derive the Euler equation from a structural model of investment and estimate our model on data on individual French firms from 1987 to 1994 by using generalized method of moments (GMM). Our empirical findings show that the level of the firm's collateral explains significant differences in the investment behavior of firms. Moreover this effect is found to vary across different subsamples of firms, divided according to size or sector, but also during the business cycle. Compared to the safe interest rate the external financing premium appears significant especially at the end of the period studied. However compared to the economic return on investment the external premium does not appear significant in most cases. So the external financing appears to play a significant role only for small industrial firms and only at the end of period.

Keywords: financial constraints; financial accelerator; firms'investment behavior; comportement d'investissement des entreprises; contraintes financières; Accélérateur financier (search for similar items in EconPapers)
Date: 2000-06
Note: View the original document on HAL open archive server: https://insee.hal.science/hal-05358456v1
References: Add references at CitEc
Citations:

Downloads: (external link)
https://insee.hal.science/hal-05358456v1/document (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:hal:wpaper:hal-05358456

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().