Abstract
Rich panel data for a large and representative sample of Estonian firms are used to estimate the sensitivity of access to capital to differing ownership structures. This is done through explicitly modelling firm investment behaviour in a dynamic setting in the presence of adjustment costs, liquidity constraints and imperfect competition. We estimate Euler equations derived in the presence of symmetric and quadratic adjustment costs and both debt and equity constraints. Generalized Method of Moments (GMM) estimates confirm the importance of access to capital in determining investment rates and suggest that firms owned by insiders, especially non-managerial employees, are more prone to be liquidity constrained than others.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
