Capital market imperfections, uncertainty and corporate investment in the Czech Republic

R Lensink*, E Sterken

*Corresponding author for this work

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9 Citations (Scopus)

Abstract

In this study we examine private investment behavior of firms in the Czech Republic. A special feature of the study is that the investment equations include variables which may give some more insights into the role of capital market imperfections as well as the effect of uncertainty. Our results find support for the accelerator model. We find evidence for cash-flow effects on Czech corporate investment. It is striking that indeed smaller longer privatized firms face relatively less cash flow restrictions. Financial structure doesn't matter as much as we expected. We find that smaller firms react positively to more uncertainty.

Original languageEnglish
Pages (from-to)53-70
Number of pages18
JournalEconomics of planning
Volume33
Issue number1-2
Publication statusPublished - 2000

Keywords

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