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Table 9 Findings of Investment equation with an alternative proxy of investment for high growth and low growth firms

From: Debt choice, growth opportunities and corporate investment: evidence from China

  Dependent Variable: INVST2 (alternative proxy of investment)
  High Growth Low Growth   High Growth Low Growth
(1) (2) (3) (4) (5) (6)
Variables DIFF GMM SYS GMM
INVST2t-1 0.113*** 0.117*** 0.119*** 0.0982*** 0.102*** 0.104***
(0.0208) (0.0206) (0.0206) (0.0194) (0.0192) (0.0192)
LEVt-1 −0.0157 − 0.0226 − 0.0247 −0.0205* − 0.0268* − 0.0291*
(0.0158) (0.0159) (0.0161) (0.0153) (0.0155) (0.0157)
GTH t-1 0.00965***    0.00938***   
(0.00137)    (0.00134)   
LEVt-1* HGTH t-1   0.0247***    0.0256***  
  (0.00465)    (0.00456)  
LEV t-1* LGTH t-1    −0.0225***    −0.0228***
   (0.00450)    (0.00440)
ROA t-1 −0.0911*** −0.0904*** − 0.0924*** −0.0953*** − 0.0938*** −0.0959***
(0.0283) (0.0291) (0.0290) (0.0278) (0.0286) (0.0286)
TG t-1 −0.686*** −0.679*** − 0.682*** −0.663*** − 0.655*** −0.658***
(0.0250) (0.0258) (0.0257) (0.0234) (0.0240) (0.0239)
CFLOW t-1 0.0570*** 0.0629*** 0.0620*** 0.0546*** 0.0606*** 0.0598***
(0.0122) (0.0123) (0.0123) (0.0120) (0.0121) (0.0121)
CASH t-1 −0.132*** −0.134*** − 0.137*** − 0.130*** − 0.131*** − 0.135***
(0.0181) (0.0183) (0.0183) (0.0176) (0.0178) (0.0178)
BSIZE t-1 −0.00132 − 0.00128 − 0.00129 − 0.00166 − 0.00156 − 0.00157
(0.00115) (0.00115) (0.00115) (0.00112) (0.00112) (0.00112)
CEODUA t-1 −0.00147 −0.00145 − 0.00156 −0.000950 − 0.00108 − 0.00123
(0.00343) (0.00343) (0.00344) (0.00335) (0.00335) (0.00336)
INDBOARD t-1 −0.00885 − 0.00981 − 0.0101 − 0.0115 − 0.0126 − 0.0127
(0.0267) (0.0270) (0.0270) (0.0264) (0.0267) (0.0267)
Constant 0.228*** 0.238*** 0.258*** 0.227*** 0.236*** 0.258***
(0.0219) (0.0217) (0.0218) (0.0214) (0.0211) (0.0213)
Year Yes Yes Yes Yes Yes Yes
Observations 5954 5954 5954 7684 7684 7684
AR(1) −12.11*** −12.26*** −12.28*** −12.2*** −12.32*** −12.34***
AR(2) 0.12 −0.029 −0.015 −0.52 − 0.66 −0.63
Sargan (p-value) 0.33 0.12 0.23 0.16 0.067 0.13
  1. Note. This Table reports findings of investment equation with an alternative proxy of investment in high-growth and low-growth firms. Arrellano-Bond tests are represented by AR (1) & AR (2) for serial correlation in residuals. Sargan (p-value) refers to the p-value of Sargan test to check the over-identification of instruments. Values of standard errors are given in parenthesis. Definitions of variables are given in Table 1. ***, and * shows the level of significance at 1%, 5%, and 10%