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Financial frictions and the K/L ratio in UK manufacturing

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  • Spaliara, Marina-Eliza

Abstract

We investigate whether technological differences of UK manufacturing industries influence the response of firms' capital-labour (K/L) ratio to changes in financial indicators under financial frictions. The results reveal that technological factors along with internal funds significantly affect the K/L ratio for financially constrained firms.

Suggested Citation

  • Spaliara, Marina-Eliza, 2011. "Financial frictions and the K/L ratio in UK manufacturing," Economics Letters, Elsevier, vol. 112(1), pages 23-25, July.
  • Handle: RePEc:eee:ecolet:v:112:y:2011:i:1:p:23-25
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    References listed on IDEAS

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    8. Bond, Stephen & Van Reenen, John, 2007. "Microeconometric Models of Investment and Employment," Handbook of Econometrics,in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 6, chapter 65 Elsevier.
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