Business groups, financing constraints, and investment: the case of India
AbstractAbstract We examine the effect of business group affiliation on corporate investment behavior in India. We use a data set containing 684 Indian listed companies for the 1989-1997 period. We estimate a simple investment equation and find evidence that cash flow has a positive effect on investment spending of stand-alone firms, whereas for group affiliates cash flow is either insignificant or has a much lower coefficient. This suggests that business group affiliates have better access to external funds than stand-alone firms.
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Bibliographic InfoPaper provided by University of Groningen, CCSO Centre for Economic Research in its series CCSO Working Papers with number 200116.
Date of creation: 2001
Date of revision:
Other versions of this item:
- Robert Lensink & Remco van der Molen & Shubashis Gangopadhyay, 2003. "Business groups, financing constraints and investment: the case of India," Journal of Development Studies, Taylor & Francis Journals, vol. 40(2), pages 93-119.
- Gangopadhyay, Shubashis & Lensink, Robert & Molen, Remco van der, 2002. "Business groups, financing constraints, and investment : the case of India," Research Report 02E02, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
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