Do mispricing and financial constraints matter for investment decisions?

Chih Liang Liu*, Yi Mien Lin

*Corresponding author for this work

研究成果: Article同行評審

摘要

This study investigates how mispricing and financing constraints affect firms’ future capital investments. We find that when the financing constraints are high, overpriced (underpriced) firms invest more (less) subsequently under previous non-optimal investments. The overpriced (underpriced) firms with precautionary motives invest significantly less subsequently when they are financially constrained. The overall evidence suggests that share mispricing, financial constraints and precautionary motives play a critical role that enables investors to less effectively monitor managers’ real decisions, thus limiting firms’ capital investments.

原文English
頁(從 - 到)5877-5892
頁數16
期刊Applied Economics
50
發行號54
DOIs
出版狀態Published - 20 十一月 2018

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