Investment, Credit Rationing, and the Soft Budget Constraint: Evidence from Czech Panel Data

Lı́zal, Lubomı́r; Švejnar, Jan

doi:10.1162/003465302317411596

Cited by 167 publications

(147 citation statements)

References 19 publications

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“…The findings are in line with Konings et al (2003) and Lizal and Svejnar (2002) who find evidence for the existence of liquidity constraints on a sample of Czech firms. As expected, the sales growth coefficient is also positive and statistically significant.…”

Section: Estimation Resultssupporting

confidence: 91%

Exporting, capital investment and financial constraints

Manole

Spatareanu

2010

Rev World Econ

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract: Many firms cite financial constraints as some of the most important impediments to their investment and growth. Using a unique data set from the Czech Republic this paper investigates the importance of financing constraints in the context of exporters. It finds that exporters are less financially constrained than non-exporters. However, after carefully correcting for possible endogeneity and selection issues, the evidence points to less constrained firms self-selecting into exporting rather than exporting alleviating firms' financial constraints. The analysis suggests that easing firms' credit constraints may play an important role in facilitating exporting and that welldeveloped financial markets that would decrease firms' cost of external finance may be needed in order to benefit from selling in foreign markets. Terms of use: Documents in EconStor may

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Section: Estimation Resultssupporting

confidence: 91%

Exporting, capital investment and financial constraints

Manole

Spatareanu

2010

Rev World Econ

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“…There are several studies analyzing the impact of ownership structures on companies' investment in Central and Eastern European transition countries: Lizal and Svejnar (2002) (Czech Republic), Perotti and Vesnaver (2004) (Hungary), Mickiewicz, Bishop and Varblane (2004) (Estonia), Colombo and Stanca (2006) (Hungary). The following stylized facts emerge.…”

Section: Introductionmentioning

confidence: 99%

The impact of equity ownership groups on investment: Evidence from Ukraine

Mykhayliv

Zauner

2017

Economic Modelling

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“…Firms in transition economies also suffered the incentive problems caused by the softness of budget constraints (see Kornai, 1990, Mathias Dewatripont, Eric Maskin andRoland, 2000;Kornai, Maskin and Roland, 2003), with poorly performing firms often being granted easier access to external investment funds than the better performing ones (Lubomír Lízal and Svejnar, 2002). This led analysts to stress that hardening of budget constraints should be a priority and could be achieved most effectively by breaking the link between firms and the state through privatization (Alan Bevan, Estrin and Mark Schaffer, 1999).…”

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confidence: 99%

Effects Of Privatization And Ownership In Transition Economies

Estrin¹,

Hanousek²,

Kočenda³

et al. 2009

Policy Research Working Papers

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The paper evaluates the effects of privatization in the post-communist economies and China. In postcommunist economies privatization to foreign owners results in a rapid improvement in performance of firms, while performance effects of privatization to domestic owners are less impressive and vary across regions, coinciding with differences in policies and institutional development. In China relatively more estimates suggest that privatization to domestic owners improves the level of performance. Concentrated private ownership has a stronger positive effect on performance than dispersed ownership in the post-communist economies, but foreign joint ventures rather than wholly owned foreign firms have a positive effect in China. Worker or collective ownership does not have a negative effect. In the postcommunist economies new firms are equally or more efficient than firms privatized to domestic owners, and foreign start-ups are more efficient than domestic ones. Privatization is not associated with lower employment. When accompanied by complementary reforms, privatization has a positive effect on economic growth. Three factors appear to drive the more positive effect of privatization to foreign than domestic owners. Domestic managers have more limited skills and access to world markets, domestically privatized firms have been more subject to tunneling and in some countries new large shareholders artificially decreased performance. The important policy implication is that privatization per se does not guarantee improved performance, at least not in the short-to medium-run. Type of private ownership, corporate governance, access to know-how and markets, and the legal and institutional system matter for firm performance.

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Investment, Credit Rationing, and the Soft Budget Constraint: Evidence from Czech Panel Data

Cited by 167 publications

References 19 publications

Exporting, capital investment and financial constraints

Exporting, capital investment and financial constraints

The impact of equity ownership groups on investment: Evidence from Ukraine

Effects Of Privatization And Ownership In Transition Economies

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