Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/74851
Authors: 
Konings, Jozef
Rizov, Marian
Vandenbussche, Hylke
Year of Publication: 
2002
Series/Report no.: 
LICOS Discussion Paper 112
Abstract: 
In this paper we investigate to what extent firm investment in transition countries is sensitive to internal finance. We use accounts data of over 4000 companies in four countries at different stages of transition. We find that firms in Bulgaria and Romania are less sensitive to internal financing constraints, in contrast to firms in Poland and the Czech Republic. A likely explanation is that Bulgaria and Romania, which are the least advanced in the refirms towards market economy, have a stronger persistence of soft budget constraints than in the other two more advanced countries.
Subjects: 
Investment
financial constraints
soft budget constraint
transition to a market economy
JEL: 
E22
G32
P21
D21
D92
Document Type: 
Working Paper

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