Investment and financial constraints in transition economies: Micro evidence from Poland, the Czech Republic, Bulgaria and Romania

Jozef Konings, Marian Rizov, Hylke Vandenbussche

Research output: Contribution to journalArticle

68 Citations (Scopus)

Abstract

We investigate to what extent firm investment in transition countries is sensitive to internal finance. We find that firms in Bulgaria and Romania are less sensitive to internal financing constraints, in contrast to firms in Poland and the Czech Republic. A likely explanation is that Bulgaria and Romania experience a stronger persistence of soft budget constraints than the other two more advanced countries.

Original languageEnglish
Pages (from-to)253-258
Number of pages6
JournalEconomics Letters
Volume78
Issue number2
DOIs
Publication statusPublished - Feb 1 2003

Keywords

  • Financial constraints
  • Investment
  • Soft budget constraint
  • Transition to a market economy

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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