The Finance-Investment Link in a Transition Economy: Evidence For Poland From Panel Data
Real investment in Poland declined from 1990 to 1993, and has only slowly since recovered, while real credit decreased for a number of years. Has declining credit adversely affected investment? Controlling for industry and time fixed effect, and using dynamic panel data techniques, I estimate an investment model, which includes external and internal finance as investment determinants. The results suggest that internal and external finance are positively related to investment. Thus, industries seem to operate under hard budget constraints. Also, internal finance is more important than external finance in determining investment, thus indicating that credit rationing occurs. Finally, the effects of external finance are slightly greater among durable goods producing industries than among non-durable goods producing industries. Comparative Economic Studies (2001) 43, 31–52; doi:10.1057/ces.2001.2
Volume (Year): 43 (2001)
Issue (Month): 1 (April)
|Contact details of provider:|| Web page: http://www.palgrave-journals.com/|
|Order Information:|| Postal: Palgrave Macmillan Journals, Subscription Department, Houndmills, Basingstoke, Hampshire RG21 6XS, UK|
Web: http://www.palgrave-journals.com/pal/subscribe/index.html Email:
When requesting a correction, please mention this item's handle: RePEc:pal:compes:v:43:y:2001:i:1:p:31-52. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Iulia Badea)
If references are entirely missing, you can add them using this form.