Essays on the measurement and implications of financing constraints Ghent University
Department of Accounting, Corporate Finance and Taxation, Department of Accounting, Corporate Finance and Taxation
The project develops a new nonparametric methodology to adequately measure financing constraints. Our measure can be seen as the potential profits that are lost due to the lack of finance. After validation, we use our measure to provide new insights why existing measures are inadequate, and, to quantify the implications of financing constraints for firms’ cash holdings and firms’ investments.