Dutch inventory investment: are capital market imperfections relevant?

H Bo*, G Kuper, R Lensink, E Sterken

*Corresponding author for this work

    Research output: Contribution to journalArticleAcademicpeer-review

    3 Citations (Scopus)
    133 Downloads (Pure)

    Abstract

    This paper analyses inventory investment using a balanced panel of 82 Dutch firms. We start from the Lovell (1961) inventory model and amend it with cash flow to introduce capital market imperfections. The empirical evidence provides support for the relevance of capital market imperfections in explaining Dutch inventory investment. The results suggest that cash flow is a relevant variable omitted from the original Lovell model. The study provides a better understanding of inventory behaviour in general.

    Original languageEnglish
    Pages (from-to)15-22
    Number of pages8
    JournalApplied Economics
    Volume34
    Issue number1
    DOIs
    Publication statusPublished - Jan-2002

    Keywords

    • CREDIT CONDITIONS
    • CONSTRAINTS
    • PANEL

    Cite this