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Does firm size matter for the financial constraints?


Citation

Ismail, Mohd Adib and Ibrahim, Mansor and Yusoff, Mohammed and Zainal, Mohd Pisal (2010) Does firm size matter for the financial constraints? Jurnal Ekonomi Malaysia, 44. pp. 73-81. ISSN 0126-1962

Abstract

This article empirically investigates the presence of financial constraints in the Malaysian capital market. The existence of financial constraints gives firm less access to external funds to finance their investment activities. Therefore, the constrained firm has to rely on internal sources of financing. The severity of financial constraints is relatively different according to firm size. Hence, the sample is divided into large and small firm subsamples. Using the Q model of investment, the results show that financial constraints are present in the Malaysian market using the full sample. The subsample results however show that large firms are not financially constrained. On the other hand, the smaller firms are facing the constraints in their investment decisions.


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Additional Metadata

Item Type: Article
Divisions: Faculty of Economics and Management
Publisher: Penerbit Universiti Kebangsaan Malaysia
Keywords: Financial constraints; Investment; Cash flow; Q-model; GMM
Depositing User: Nabilah Mustapa
Date Deposited: 02 Feb 2016 03:59
Last Modified: 02 Feb 2016 03:59
URI: http://psasir.upm.edu.my/id/eprint/17010
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