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Structural modelling of investment and financial constraints: Where do we stand?

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  • Jean-Bernard Chatelain

    () (University of Orléans)

Abstract

This paper surveys issues with respect to the structural modelling of econometric tests of investment facing financial constraints, to their link with firms data and assets prices, and to their impact in macroeconomic modelling. The key issue is to ground much more the interpretation of the sensitivity of investment to liquidity variables such as cash flow as a measure of financial constraints. The structural modelling of investment facing financial constraints is also limited by the structural modelling of the force driving investment dynamics such as adjustment costs, which has not been so successful empirically.

Suggested Citation

  • Jean-Bernard Chatelain, 2002. "Structural modelling of investment and financial constraints: Where do we stand?," Working Paper Research 28, National Bank of Belgium.
  • Handle: RePEc:nbb:reswpp:200205-9
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    File URL: https://www.nbb.be/doc/oc/repec/reswpp/wp28.pdf
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    Cited by:

    1. von Kalckreuth, Ulf & Chirinko, Robert S. & Breitung, Jörg, 2003. "A Vectorautoregressive Investment Model (VIM) and Monetary Policy Transmission: Panel Evidence from German Firms," Discussion Paper Series 1: Economic Studies 2003,06, Deutsche Bundesbank.
    2. Geert Langenus, 2006. "Fiscal sustainability indicators and policy design in the face of ageing," Working Paper Research 102, National Bank of Belgium.

    More about this item

    JEL classification:

    • D92 - Microeconomics - - Micro-Based Behavioral Economics - - - Intertemporal Firm Choice, Investment, Capacity, and Financing

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