A competitive firm which chooses the timing of investment and optimal volume of debt is considered. The price of the firm’s output follows the geometric Brownian motion or more general jump-diffusion processes, and the firm takes an arbitrage free borrowing rate as given. The optimal timing of investment and volume of debt is computed, and it is shown that if the borrowing rate is close to the ...

a r t i c l e i n f o We re-evaluate the cash flow–investment relation from a new angle in a setting where the firm can access capital markets and faces different investment opportunity sets. Instead of replying on cash flow, we introduce other forms of finance to interact with investment. We find that financial variables enter significantly into the investment regressions at different timing. ...

The main purpose of this paper is to investigate the performance of Nigerian insurance companies using Data Envelopment Analysis (DEA). Because of the unavailability of the required data, the study is limited to ten Nigerian insurance companies for the period of five years from 2008 to 2012. The input employed were commission expenses and management expenses, while premium and investment income...

We analyse the leasing decision of more than 3000 UK quoted and unquoted companies over the sample period 1982-1996. We show that, for the sample as a whole, companies that use leasing are more likely to have tax losses, high fixed capital investment, high debt-to-equity ratio and to be larger than companies that do not use leasing. We show, however, that the determinants of leasing are not hom...

Article history: Received 5 March 2012 Received in revised form 7 October 2012 Accepted 13 October 2012 Available online 22 October 2012 This paper explores the relationship between firms' investment and stock market liquidity. Using a panel of Latin American firms, I find evidence that a higher trading volume and a higher industry-adjusted trading volume are associated with higher firm investm...

Abstract O ur basic aim in this paper concerns the question that if overusing the Information Technology by service and manufacturing firms can increase the total productivity resulting from this kind of technology regarding the Iran's economic structure and conditions. For this purpose, we primarily evaluate the productivity resulting from the rate of firms' use of IT for...

TAbstract T—This paper develops a tractable real options framework to analyze the effects of asymmetric information on firms' investment decisions when firms issue equity to finance investment. We assume that firm insiders exactly know the firms' growth prospects, but outside investors do not know. Our analysis shows that, under equity financing, the corporate insiders can signal their private ...