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Title: What is the investment loss due to uncertainty?
Authors: Panagiotidis, Theodore
Printzis, Panagiotis
Type: Article
Subjects: FRASCATI::Social sciences::Economics and Business
Keywords: Greek firms
Panel data
Issue Date: Aug-2020
Publisher: Elsevier
Source: Global Finance Journal
Volume: 45
First Page: 100476
Abstract: We investigate the effect of uncertainty on investment. We employ a unique dataset of 25,000 Greek firms' balance sheets for 14 years covering the period before and after the eurozone crisis. A dynamic factor model is employed to proxy uncertainty. The investment performance of 14 sectors is examined within a dynamic investment model. Robust GMM estimates of the investment rate model reveal a high degree of heterogeneity among these sectors. Overall uncertainty affects negatively investment performance and this effect substantially increased in the years of crisis. Agriculture and Mining are the least affected and the most affected ones include Manufacturing, Real Estate and Hotels. Focusing on the response of investment to uncertainty, it emerges that (relative) smaller firms are affected more compared to larger ones.
ISSN: 1044-0283
Other Identifiers: 10.1016/j.gfj.2019.100476
Appears in Collections:Department of Business Administration
Department of Economics

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