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Financial Innovation

Table 8 Results tangible net worth

From: Financial constraints and investment decisions of listed Indian manufacturing firms

 

LTNW

MTNW

HTNW

 

One step estimator

Two step estimator

One step estimator

Two step estimator

One step estimator

Two step estimator

Investment

Coefficient

Std. Err.

Coefficient

Std. Err.

Coefficient

Std. Err.

Coefficient

Std. Err.

Coefficient

Std. Err.

Coefficient

Std. Err.

Lagged investment

−0.00746

0.033

− 0.00133

0.005

− 0.00303

0.007

− 0.00389***

0.001

0.021835

0.047

0.023893

0.017

Change in sales

0.001546

0.002

0.001371

0.002

0.268974***

0.009

0.275641***

0.020

0.007157**

0.003

0.004861

0.011

Cash flow

0.119557**

0.052

0.121244**

0.050

−0.90963***

0.087

−0.57067***

0.171

0.095724a

0.053

0.042613

0.070

Leverage

0.004074

0.003

0.003082

0.007

0.737238***

0.030

0.751301***

0.053

0.1779***

0.012

0.087678

0.058

Tangibility

0.000691

0.018

0.00037

0.003

−0.02134

0.015

0.017962

0.022

−0.01166

0.009

−0.00304

0.008

Cash flow* Tangibility

−0.01641

0.056

−0.00105

0.0039

0.036817*

0.022

−0.03022

0.037

0.029257

0.021

0.005811

0.024

Constant

0.149533***

0.045

0.135074***

0.022

−0.37949***

0.045

−0.42869***

0.071

−0.12802***

0.036

0.031021

0.063

AR 1

–

–

0.0066

–

–

 

0.2304

–

–

–

0.2464

–

AR 2

–

–

0.9225

–

–

 

0.2902

–

–

–

0.7519

–

Sargan statistics

0.5824

–

0.6458

–

.0007

 

0.3126

–

0.3206

–

0.3353

–

  1. The table represents results using Tangible net worth (debt capacity) as the priori classification for dividing firms. AR1 and AR2 represent Arellano and Bond test (1991) for autocorrelation in first difference errors. Sargan test for the over-identifying restriction is also highlighted in the table. ***, **,* represents significance at 99%, 95% and 90% respectively
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