Impact of Liquidity constraint on Firms’ Investment Decisions

The paper investigates whether the effects of monetary policy on firm investment can be transmitted through leverage. The findings indicate that monetary contractions reduce investment for highly leveraged firms. The estimates imply that a 1percentage point increase in leverage reduces investment by 0.109 percent through leverage. Robustness tests broadly validate these findings.

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Year of publication:	2006
Authors:	Ghosh, Saibal ; Ghosh, Saurabh
Institutions:	Volkswirtschaftliche Fakultät, Ludwig-Maximilians-Universität München
Subject:	investment \| leverage \| India

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Extent:	application/pdf
Series:	MPRA Paper.
Type of publication:	Book / Working Paper
Notes:	Published in Economia Internazionale 1.54(2006): pp. 17-32
Classification:	G32 - Financing Policy; Capital and Ownership Structure
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005089318