The authors use firm level data on
Bulgaria to investigate the impact of liquidity constraints
on firms investment performance. Internal funds are a
important determinant of investment in most industrial
economies. The authors use a simple accelerator model of
investment to test whether liquidity constraints are
relevant in Bulgaria's case. Their estimates are based on
data for 1993-95, before Bulgaria's financial crisis of
1996-97. It turns out that Bulgarian firms are
liquidity-constrained and that firms size and financial
structure help to distinguish between firms that are more
and less liquidity-constrained. In the authors' view,
liquidity constraints in transition economies should be
interpreted in different ways than those in industrial
economies. In Bulgaria, liquidity constraints, and hence
access to external funds should be seen in the context of
soft budget constraints and the financial systems failure to
enforce the efficient allocation of funds. The relationship
between liquidity constraints and firm characteristics may
actually be the opposite of what is normally the case in
industrial countries. In Bulgaria, lack of liquidity
constraints may be a sign of financial weakness.
Bibliographic Details
| Main Authors: |
Budina, Nina,
Garretsen, Harry,
de Jong, Eelke |
|---|
| Format: | Working Paper
biblioteca
|
|---|
| Language: | English
en_US |
|---|
| Published: |
World Bank, Washington, DC
2000-01
|
|---|
| Subjects: | ADVERSE SELECTION,
ASSETS,
ASYMMETRIC INFORMATION,
BAD DEBT,
BAD DEBTS,
BALANCE SHEET,
BANK CAPITAL,
BANK LOANS,
BANK PORTFOLIOS,
BANKING SECTOR,
BANKING SYSTEM,
BANKRUPTCY,
BANKRUPTCY PROCEDURES,
BANKS,
BORROWING,
CAPITAL MARKETS,
CASH FLOWS,
CENTRALLY PLANNED ECONOMIES,
CENTRALLY PLANNED ECONOMY,
COMMERCIAL BANKS,
COST OF CAPITAL,
CREDIT RATIONING,
DEBT,
DEPRECIATION,
DIVIDEND POLICY,
ECONOMIC GROWTH,
EMPIRICAL ANALYSIS,
EMPIRICAL STUDIES,
EXCHANGE RATE,
EXOGENOUS VARIABLES,
EXPECTED RETURN,
EXPENDITURES,
FINANCIAL CRISIS,
FINANCIAL INSTITUTIONS,
FINANCIAL MARKETS,
FINANCIAL RESOURCES,
FINANCIAL SECTOR,
FINANCIAL STRUCTURE,
GDP,
INDUSTRIAL ECONOMIES,
INFLATION,
INHERITANCE,
LIQUIDATION,
LIQUIDITY,
MACROECONOMICS,
MARKET ECONOMIES,
MARKET INCENTIVES,
MARKET VALUE,
MORAL HAZARD,
NET LOSS,
NET WORTH,
PERFECT INFORMATION,
PERVERSE INCENTIVES,
PORTFOLIOS,
PRIVATE BANKS,
PROFITABILITY,
SHORT TERM DEBT,
SOFT BUDGET CONSTRAINTS,
STATE ENTERPRISES,
TANGIBLE ASSETS,
TIME SERIES,
TRANSITION ECONOMIES,
LIQUIDITY CONTROLS, |
|---|
| Online Access: | http://documents.worldbank.org/curated/en/2000/01/438413/liquidity-constraints-investment-transition-economies-case-bulgaria
https://hdl.handle.net/10986/22280
|
|---|
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
|---|
