Economic Policy Uncertainty and Corporate Investment Efficiency: Evidence from Australian Energy Companies
Nga Trinh
Abstract:This study examines the impact of Economic Policy Uncertainty (EPU) on corporate investment efficiency. I argue that EPU increases financing constraints or induces firms to postpone investment projects, thereby reducing their investment efficiency. Using a data set of Australian energy firms from 2010 to 2022 and the EPU index of Australia, the findings show that the EPU index has a significant and negative effect on corporate investment efficiency. The results hold in fixed-effects and dynamic GMM models and … Show more
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.