Kadri Männasoo, (TalTech), co-authors Kaido Kepp, Peeter Maripuu
Corporate Investments, Credit and Financial Strength: European Evidence
The current paper investigates the linkages between the investments, credits and financial strength of European manufacturing companies employing the non-linear visualization and the panel GMM estimations enabling to account for complex, endogenous relationships emerging in the model setup. The analysis is based on Amadeus database, a micro-level dataset of European companies, covering the annual financial information over 2005-2013 for 11467 European firms. The capital investments’s timing over economic cycle has vital importance for companies financial standing and even more so conditional on funding scheme.