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dc.contributor.authorTomat, Gian Mariaen_US
dc.date.accessioned2009-01-28T15:05:13Z-
dc.date.available2009-01-28T15:05:13Z-
dc.date.issued2007en_US
dc.identifier.urihttp://hdl.handle.net/10419/17961-
dc.description.abstractThe paper develops a model of firm´s investment under uncertainty with financial market imperfections and analyzes the effects of financial constraints on firm´s investment. Firm´s investment is an increasing function of the firm´s marginal q, however the investment function is characterized by an upper bound that depends on the firm´s borrowing capabilities. The firm´s marginal q is the sum of the expected value of the marginal profitability of the physical capital stock and of a positive external finance premium. In the presence of financial market imperfections the firm forms expectations about future financial conditions and these expectations raise the firm´s current marginal q. Similarly, the shadow price of firm´s debt is the sum of the interest cost of debt repayment and of a provision for external finance that depends on the firm´s expectations over future financial conditions.en_US
dc.language.isoengen_US
dc.publisherKiel Institute for the World Economy (IfW) Kiel-
dc.relation.ispartofseriesEconomics Discussion Papers / Institut für Weltwirtschaft 2007-38en_US
dc.subject.jelE22en_US
dc.subject.jelD92en_US
dc.subject.ddc330en_US
dc.subject.keywordfirm´s investmenten_US
dc.subject.keywordfinancial constraintsen_US
dc.subject.keywordTobin´s marginal qen_US
dc.subject.keyworduncertaintyen_US
dc.titleModeling the Effects of Financial Constraints on Firm´s Investmenten_US
dc.typeWorking Paperen_US
dc.identifier.ppn558404030en_US
dc.rights.licensehttp://creativecommons.org/licenses/by-nc/2.0/de/deed.en-
dc.identifier.repecRePEc:zbw:ifwedp:6165-
Appears in Collections:Economics: The Open-Access, Open-Assessment E-Journal - Discussion Papers

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