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A Q Model Investment System in Material and Immaterial Assets

  • Gema Pastor-Agustin
  • Manuel Espitia-Escuer
  • Marisa Ramirez-Aleson

The aim of this paper is to study the determinants of investment on material and immaterial assets of Spanish firms considering they are heterogeneous assets. With this objective, we propose an investment model based on both prospective models and Tobin’s q. The developed model is then applied to analyse the investment determinants of material and immaterial assets over a panel of 87 non-financial Spanish firms that have been quoting on the Stock Market during 12 years. Results show that material investment decisions are isolated from immaterial assets, whereas immaterial investment is affected by tangible investment and stock.

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Article provided by European Research Studies Journal in its journal European Research Studies Journal.

Volume (Year): X (2007)
Issue (Month): 1-2 ()
Pages: 43-64

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Handle: RePEc:ers:journl:v:x:y:2007:i:1-2:p:43-64
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  7. Epstein, Larry G, 1983. " Aggregating Quasi-Fixed Factors," Scandinavian Journal of Economics, Wiley Blackwell, vol. 85(2), pages 191-205.
  8. Pieter J. de Jong, 2007. "The relationship between capital investment and R&D spending: a panel cointegration analysis," Applied Financial Economics, Taylor & Francis Journals, vol. 17(11), pages 871-880.
  9. Timothy Dunne, 1994. "Plant Age and Technology Use in US. Manufacturing Industries," RAND Journal of Economics, The RAND Corporation, vol. 25(3), pages 488-499, Autumn.
  10. Lindenberg, Eric B & Ross, Stephen A, 1981. "Tobin's q Ratio and Industrial Organization," The Journal of Business, University of Chicago Press, vol. 54(1), pages 1-32, January.
  11. Chirinko, Robert S., 1993. "Multiple capital inputs, Q, and investment spending," Journal of Economic Dynamics and Control, Elsevier, vol. 17(5-6), pages 907-928.
  12. Breusch, T S & Pagan, A R, 1980. "The Lagrange Multiplier Test and Its Applications to Model Specification in Econometrics," Review of Economic Studies, Wiley Blackwell, vol. 47(1), pages 239-53, January.
  13. Leonard Nakamura, 1999. "Intangibles: what put the new in the new economy?," Business Review, Federal Reserve Bank of Philadelphia, issue Jul, pages 3-16.
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  15. Baltagi, Badi H. & Li, Qi, 1995. "Testing AR(1) against MA(1) disturbances in an error component model," Journal of Econometrics, Elsevier, vol. 68(1), pages 133-151, July.
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