The Effect of Financial Development on the Investment of the Companies Listed on the Tehran Stock Exchange

Abdi, Ebrahim; Khodadad kashi, Farhad; Mosavi Jahromi, Yeganeh

doi:10.29252/jemr.9.33.7

Volume 9, Issue 33 (10-2018) jemr 2018, 9(33): 7-42 | Back to browse issues page

‎ 10.29252/jemr.9.33.7

‎ 20.1001.1.22286454.1397.9.33.7.1

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Abdi E, Khodadad kashi F, Mosavi Jahromi Y. The Effect of Financial Development on the Investment of the Companies Listed on the Tehran Stock Exchange. jemr 2018; 9 (33) :7-42
URL: http://jemr.khu.ac.ir/article-1-1688-en.html

The Effect of Financial Development on the Investment of the Companies Listed on the Tehran Stock Exchange

Ebrahim Abdi ^*

¹, Farhad Khodadad kashi²

, Yeganeh Mosavi Jahromi²

1- payame noor university , eb_abdi@pnu.ac.ir
2- payame noor university

Abstract: (5760 Views)

The present study examined the impact of financial development on the investment of the companies listed on the Tehran Stock Exchange. To achieve this goal, data gathered from 258 companies during 2005 to 2016 and the dynamic generalized method of moments were utilized to formulate the investment model with financial constraints. The results of the study showed that these companies faced financial constraints on investment and financial development has increased their investment by reducing the financial constraints. The results also indicated that the positive effect of financial development on investment has been bigger in the case of larger companies than in smaller companies. It was further revealed that during the economic boom, financial constraints on companies were reduced and financial development led to the reinforcement of the positive effect of the boom on reduction of the companies’ financial constraints

Keywords: Financial Development, Investment, Financial Constraints, Firm Size, Business Cycles.

Full-Text [PDF 960 kb] (2381 Downloads)

Type of Study: Applicable | Subject: پولی و مالی
Received: 2018/04/4 | Accepted: 2018/07/25 | Published: 2018/12/19

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