Investment Behavior of Firms

Real investment takes a prominent position in determination of natio-nal income in modern industrial economies. Unfortunately investment behaviour of firms remains an area still poorly understood by econo-mists and policy makers. Economic research identifies certain factors, both real and financial, to have significant influence on firm level in-vestment decisions. However, the nature and extent of their asso-ciation with real investment decisions is still widely debated. This book attempts to shed light on some of these hitherto unsolved issues. The book contains comprehensive theoretical analysis of the impact of uncertainty, capital market imperfections and debt over-hang on investment decision of firms. A panel data regression has also been conducted to find out the relative importance of these factors on firm level investments. The book will be of interest to post graduate students of economics and management. Policy makers and corporate houses will also find this book useful.