Structural Modelling of Financial Constraints on Investment: Where Do We Stand?

Jean-Bernard Chatelain (1)

1 CES - Centre d'économie de la Sorbonne

This paper surveys issues with respect to the structural modelling of econometric tests of investment facing financial constraints, to their link with firms data and asset prices, and to their consequences for macroeconomic modelling. The key issue is to provide conditions which support the interpretation of the sensitivity of investment to liquidity variables such as cash flow as a measure of financial constraints. The structural modelling of investment facing financial constraints is also limited by the structural modelling of the forces driving investment dynamics such as adjustment costs, which has not been so successful empirically.

Mots clés: Investment; Financial Constraints; Structural models

Domaines: Economies et finances

Jean-Bernard Chatelain. Structural Modelling of Financial Constraints on Investment: Where Do We Stand?. Butzen P. and Fuss C. Firms' investment and finance decision, Edward Elgar, pp.40-58, 2003. ⟨halshs-00112522⟩