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Non-Linearities in the Expansion of Capital Stock

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dc.creator Pfann, Gerard A.
dc.creator Letterie, Wilko
dc.creator Verick, Sher
dc.date 2004
dc.date.accessioned 2013-10-16T07:10:12Z
dc.date.available 2013-10-16T07:10:12Z
dc.date.issued 2013-10-16
dc.identifier http://hdl.handle.net/10419/20367
dc.identifier ppn:386737142
dc.identifier.uri http://koha.mediu.edu.my:8181/xmlui/handle/10419/20367
dc.description The empirical identification of non-linearities in investment relies on how investment is assumed to be separated into various regimes. Using German establishment-level panel data, we estimate a two-regime model of replacement and expansion investment which allows us to observe regime separation, an aspect of the data that is typically absent from previous empirical studies. Our results indicate that firms tend to spread the expansion of capital stock over a period of years rather than concentrating investment in a single year. Moreover, there is evidence that investment is more sensitive to fundamentals in the high regime, where establishments both replace and expand capital stock, than in the low regime, where they only invest in replacement. Finally, correcting for endogenous sample selection indicates that this source of bias does not affect the coefficient estimates significantly.
dc.language eng
dc.relation IZA Discussion paper series 1132
dc.rights http://www.econstor.eu/dspace/Nutzungsbedingungen
dc.subject C24
dc.subject C23
dc.subject E22
dc.subject ddc:330
dc.subject investment
dc.subject non-convex adjustment costs
dc.subject sample selection bias
dc.subject panel data
dc.subject Investition
dc.subject Reinvestition
dc.subject Anpassungskosten
dc.subject Tobin's q
dc.subject Schätzung
dc.subject Deutschland
dc.title Non-Linearities in the Expansion of Capital Stock
dc.type doc-type:workingPaper

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