Abstract
This article considers whether differences in the structure of agriculture credit markets in France and the United Kingdom alters the investment sensitivity to financial variables particularly cash flow. Using two panel datasets of French and British farms, three approaches are used to test the sensitivity of investment to internal finance, an inventory investment model, a fundamental q-model, and Euler equations for machinery investment. The results suggest that the contrasting capital markets structures do induce differences in overall investment sensitivity to cash flow and its pattern across both farms with varying levels of collateral and between inventory and machinery investment.
| Original language | English |
|---|---|
| Pages (from-to) | 1115-1129 |
| Number of pages | 14 |
| Journal | American Journal of Agricultural Economics |
| Volume | 84 |
| Issue number | 4 |
| DOIs | |
| Publication status | Published - Nov 2002 |
Keywords
- cash flow
- farm investment
- France
- panel data
- United Kingdom
- CONSTRAINTS
- FINANCE
Cite this
Does capital market structure affect farm investment? A comparison using French and British farm level panel data. / Benjamin, Catherine; Phimister, Euan.
In: American Journal of Agricultural Economics, Vol. 84, No. 4, 11.2002, p. 1115-1129.Research output: Contribution to journal › Article
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TY - JOUR
T1 - Does capital market structure affect farm investment? A comparison using French and British farm level panel data
AU - Benjamin, Catherine
AU - Phimister, Euan
PY - 2002/11
Y1 - 2002/11
N2 - This article considers whether differences in the structure of agriculture credit markets in France and the United Kingdom alters the investment sensitivity to financial variables particularly cash flow. Using two panel datasets of French and British farms, three approaches are used to test the sensitivity of investment to internal finance, an inventory investment model, a fundamental q-model, and Euler equations for machinery investment. The results suggest that the contrasting capital markets structures do induce differences in overall investment sensitivity to cash flow and its pattern across both farms with varying levels of collateral and between inventory and machinery investment.
AB - This article considers whether differences in the structure of agriculture credit markets in France and the United Kingdom alters the investment sensitivity to financial variables particularly cash flow. Using two panel datasets of French and British farms, three approaches are used to test the sensitivity of investment to internal finance, an inventory investment model, a fundamental q-model, and Euler equations for machinery investment. The results suggest that the contrasting capital markets structures do induce differences in overall investment sensitivity to cash flow and its pattern across both farms with varying levels of collateral and between inventory and machinery investment.
KW - cash flow
KW - farm investment
KW - France
KW - panel data
KW - United Kingdom
KW - CONSTRAINTS
KW - FINANCE
U2 - 10.1111/1467-8276.00372
DO - 10.1111/1467-8276.00372
M3 - Article
VL - 84
SP - 1115
EP - 1129
JO - American Journal of Agricultural Economics
JF - American Journal of Agricultural Economics
SN - 0002-9092
IS - 4
ER -