Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/92733
Authors: 
Ogawa, Kazuo
Year of Publication: 
2003
Series/Report no.: 
ISER Discussion Paper, Institute of Social and Economic Research, Osaka University 584
Abstract: 
We examine quantitatively the extent to which financial distress in the 90s affected Japanese corporate investment. Based on the firm-level data that includes small, unlisted firms, we estimate investment function to measure the impact of financial distress on investment. We find that the firm's ratio of debt to total asset exerts a significantly negative effect on investment of small firms. We also find that lending attitude of financial institutions did affect investment behavior irrespective of firm size. The impact of lending attitude on investment is notably large for 1998 labeled 'credit crunch.'
Subjects: 
Financial distress
Debt hangover
Investment
External finance premium Lending channel
JEL: 
E22
E44
E51
Document Type: 
Working Paper

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