Authors: | Kallandranis, Christos |
Issue Date: | 1-Jan-2019 |
Journal: | Risk Governance and Control: Financial Markets & Institutions |
Volume: | 9 |
Issue: | 1 |
Keywords: | Investment, Non-linearities, Panel data, Tobin’s q |
Abstract: | A dynamic-panel model is applied in order to empirically investigate the relationship between business fixed investment and Tobin’s q for the firms listed in the Athens Stock Exchange (ASE). In particular, we search for non-linearities in the underlying relationship between investment and fundamentals, consistent with the presence of multiple regimes. The empirical results support a discontinuity identifying two-regimes: (a) wherein the first (for values of q below a certain threshold) investment is inelastic to q, while in the second it exhibits a positive relationship, and b) a further non-linearity expressed in a concavity of the investment- q relationship implying that for the segment where investment reacts to fundamentals positively, it does so at a decreasing rate evidence which is consistent with the presence of non-convexities in adjustment costs. |
ISSN: | 2077-4303 |
DOI: | 10.22495/rgcv9i1p5 |
URI: | https://uniwacris.uniwa.gr/handle/3000/1350 |
Type: | Article |
Department: | Department of Accounting and Finance |
School: | School of Administrative, Economics and Social Sciences |
Affiliation: | University of West Attica (UNIWA) |
Appears in Collections: | Articles / Άρθρα |
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