Please use this identifier to cite or link to this item: http://hdl.handle.net/1822/18766

TitleBusiness fixed investment: the case of the Portuguese manufacturing industry
Author(s)Cunha, Jorge
Paisana, António
KeywordsInvestment
Cash Flow
Financial constraints
Issue date2003
Abstract(s)The objective of this paper is to present the results of a study undertaken on the identification of the main determinants of business fixed investment decisions in the Portuguese manufacturing industry. Special attention was given to the validity of the financial constraint hypothesis. This can be seen in the light of the strong connection between the investment decisions of the firm and their cash flows. The independence between the firm’s investment and financing decisions is thus not possible. A sample of 808 firms belonging to the manufacturing sector was used. This sample was divided into two groups according to a number of criteria (size of firm, maturity, and equity to total assets ratio) in order to identify differences in the investment behaviour of these two groups. The main results of this study were: (1) the financial restrictions hypothesis is valid; (2) the estimated coefficients of the cash flows are higher for firms that are a priori less exposed to information problems.
TypeConference paper
URIhttp://hdl.handle.net/1822/18766
Peer-Reviewedyes
AccessOpen access
Appears in Collections:CGIT - Publicações em actas de encontros científicos / Papers in conference proceedings
CITEPE - Publicações em actas de encontros científicos / Papers in conference proceedings

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