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Navigating Investment Waters: Uncovering the Impact of Financial Factors on Business Behavior in Small Economies

Ieva Statkevičiūtė et al.

Review of European Studies2024https://doi.org/10.5539/res.v16n1p16article
AJG 1
Weight
0.30

What the paper says

Using companies listed on the Nasdaq Baltic Stock Exchange (2017–2021), we analyze the influence of financial factors on the investment behavior of businesses in small economies. We run a panel regression to examine which financial factors influence corporate investment and study how business investment is affected by the previous year’s cash flow, leverage ratio, asset turnover, liquidity, and sales volume. Our findings reveal robust evidence that the level of the investment of firms is negatively affected by the leverage ratio and positively affected by the asset turnover ratio. We also find that the cash flow to asset ratio has a negative but statistically insignificant affection investment. This implies that businesses in small economies are not interested in the capital market. Companies should consider taking the leverage ratio into account and incorporating it in their investment decision-making models.

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https://doi.org/https://doi.org/10.5539/res.v16n1p16

Or copy a formatted citation

@article{ieva2024,
  title        = {{Navigating Investment Waters: Uncovering the Impact of Financial Factors on Business Behavior in Small Economies}},
  author       = {Ieva Statkevičiūtė et al.},
  journal      = {Review of European Studies},
  year         = {2024},
  doi          = {https://doi.org/https://doi.org/10.5539/res.v16n1p16},
}

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Navigating Investment Waters: Uncovering the Impact of Financial Factors on Business Behavior in Small Economies

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Evidence weight

0.30

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.00 × 0.4 = 0.00
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.