Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/211926 
Authors: 
Year of Publication: 
2002
Series/Report no.: 
Bank of Finland Discussion Papers No. 22/2002
Publisher: 
Bank of Finland, Helsinki
Abstract: 
In this paper we estimate reduced form investment equations for Finland using aggregate as well as firm-level panel data.We obtain significant estimates of the accelerator and user-cost effects on investment with both aggregate and firm level data, but these effects appear to be stronger at the aggregate level.Although the response of firms' investment spending to shifts in monetary policy seems to be quantitatively nontrivial, it is surprisingly weak according to the results with firm-level data, and a considerable amount of heterogeneity also exists across firms in this respect. The firm-level estimates do not provide evidence for the existence of binding financing constraints in firms' investment spending, at least among the sampled large firms, as we cannot obtain a significant coefficient estimate on the cash flow variable.
Subjects: 
accelerator
user cost
transmission of monetary policy
panel data
Persistent Identifier of the first edition: 
ISBN: 
952-462-007-3
Document Type: 
Working Paper

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