The delaying effect of financing constraints on investment
Wilko Letterie () and
Laar Mindel van de
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Laar Mindel van de: METEOR
No 4, Research Memorandum from Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR)
We develop a simple model in which a firm considers a number of investment projects. Because of limited financial resources, the firm can undertake at most one project. In line with the literature on real options we stress features like irreversibility, uncertainty and the possibility to postpone the investment decision and argue that financing constraints tend to increase the value of waiting.
Keywords: Economics (search for similar items in EconPapers)
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Journal Article: The Delaying Effect of Financing Constraints on Investment (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:unm:umamet:2003004
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