Moderators factors of the relationship between corporate liquidity and investment

Authors

  • Celísia Baptista
  • Fernanda Matias
  • Patrícia Valle

Keywords:

Liquidity, investment, leverage, industry environment, corporate strategy

Abstract

This study aims to evaluate the moderator role of industry
environment and business strategy on the effect of internal liquidity
on firm´s investment. Recent literature suggests that the intensity of
the relationship between internal liquidity and investment explains
firm´s financial constraints in the access to the capital market.
Applied research is conducted with a sample of non-financial firms in
Portuguese manufacturing industry. It was estimated a panel data
model composed of financial, environmental, strategic and interactive
variables.
The regression of the previous model noted that industry
environment and business strategy moderate internal liquidity's
relationship with the investment, increasing or reducing it. This
suggests that agency and adverse selection costs are influenced by
environmental and strategic factors, hindering or facilitating access to
funds that firms need.

Downloads

Published

31.07.2013

Issue

Section

Business/Management: Research Papers

How to Cite

Moderators factors of the relationship between corporate liquidity and investment. (2013). Tourism & Management Studies, 9(2), 71-77. https://www.tmstudies.net/index.php/ectms/article/view/586