Uncertainty and investment: Some evidence from the panel data of Japanese manufacturing firms

Japanese Economic Review

Volumn 51, Issue 2, 2000, Pages 170-192

  Ogawa, Kazuo ^a   Suzuki, Kazuyuki ^b  

^a OSAKA UNIVERSITY   (Japan)

^b MEIJI UNIVERSITY   (Japan)

Author keywords

[No Author keywords available]

Indexed keywords

INDUSTRIAL INVESTMENT; INVESTMENT INCENTIVE; MANUFACTURING; UNCERTAINTY ROLE;

JAPAN;

EID: 0034116332     PISSN: 13524739     EISSN: None     Source Type: Journal    
DOI: 10.1111/1468-5876.00145     Document Type: Article

References (43)

1. Abel, A. B. (1983) "Optimal Investment under Uncertainty", American Economic Review, Vol. 73, pp. 228-233.
2. _ and O. J. Blanchard (1988) "Investment and Sales: Some Empirical Evidence", in W. A. Barnett, E. R. Berndt and H. White (eds.), Dynamic Econometric Modeling, Cambridge: Cambridge University Press, pp. 269-296.
3. Aizenman, J. and N. P. Marion (1996) "Volatility and the Investment Response", NBER Working Paper no. 5841, Cambridge, Mass.
4. Arrow, K. J. (1968) "Optimal Capital Policy with Irreversible Investment", in J. N. Wolfe (ed.), Value, Capital and Growth: Essays in Honor of Sir John Hicks, Edinburgh: Edinburgh University Press, pp. 1-19.
5. Baba, N. (1995) "On the Causes of the Difference in Prices between Japan and the Other Countries: An Investigation through the Empirical Study of Mark-up Pricing", Kin-yu Kenkyu (Bank of Japan), Vol. 14, no. 2. pp. 71-97 (in Japanese).
6. Bell, G. K. and J. M. Campa (1997) "Irreversible Investments and Volatile Markets: A Study of the Chemical Processing Industry", Review of Economics and Statistics, Vol. 79, pp. 79-87.
7. Bertola, G. (1988) "Adjustment Costs and Dynamic Factor Demands: Investment and Employment Under Uncertainty", PhD dissertation, Massachusetts Institute of Technology.
8. Bizer, D. and D. Sichel (1991) "Asymmetric Adjustment Costs, Capital Longevity, and Investment", Working Paper no. 119, Board of Governors of the Federal Reserve System, Washington, DC.
9. Caballero, R. J. (1991) "On the Sign of the Investment-Uncertainty Relationship", American Economic Review, Vol. 81, pp. 279-288.
10. _ and R. S. Pindyck (1996) "Uncertainty, Investment, and Industry Evolution", International Economic Review, Vol. 37, pp. 641-662.
11. Chida, R. (1997) "Corporate Investment and Uncertainty", paper presented at the 1997 Biwako econometric meeting (in Japanese).
12. Clark, P. K. (1979) "Investment in the 1970s: Theory, Performance, and Prediction", Brookings Papers on Economic Activity, Vol. 1, pp. 73-124.
13. Dixit, A. K. and R. S. Pindyck (1994) Investment under Uncertainty, Princeton: Princeton University Press.
14. Economic Planning Agency (1993) Economic White Papers, Tokyo: Government Printing Office.
15. Fazzari, M. S., Hubbard, R. G. and B. C. Petersen (1988) "Financing Constraints and Corporate Investment", Brookings Papers on Economic Activity, Vol. 1, pp. 141-195.
16. Ferderer, J. P. (1993) "The Impact of Uncertainty on Aggregate Investment Spending: An Empircal Analysis", Journal of Money, Credit, and Banking, Vol. 25, pp. 30-48.
17. Ghosal, V. and P. Loungani (1996) "Product Market Competition and the Impact of Price Uncertainty on Investment: Some Evidence from US Manufacturing Industries", Journal of Industrial Economics, Vol. 44, pp. 217-228.
18. Hartman, R. (1972) "The Effect of Price and Cost Uncertainty on Investment", Journal of Economic Theory, Vol. 5, pp. 258-266.
19. Hausman, J. A. (1978) "Specification Tests in Econometrics", Econometrica, Vol. 46, pp. 1251-1271.
20. Hayashi, F. and T. Inoue (1991) "The Relation between Firm Growth and Q with Multiple Capital Goods: Theory and Evidence from Panel Data on Japanese Firms", Econometrica, Vol. 59, pp. 731-753.
21. Hoshi, T. and A. K. Kashyap (1990) "Evidence on Q and Investment for Japanese Firms", Journal of the Japanese and International Economies, Vol. 4, pp. 371-400.
22. Hubbard, R. G. (1994) "Investment under Uncertainty: Keeping One's Options Open", Journal of Economic Literature, Vol. 32, pp. 1816-1831.
23. Huizinga, J. (1993) "Inflation Uncertainty, Relative Price Uncertainty, and Investment in US Manufacturing", Journal of Money, Credit, and Banking, Vol. 25, pp. 521-557.
24. Kaplan, S. N. and L. Zingales (1997) "Do Investment-Cash Flow Sensitivities Provide Useful Measures of Financing Constraints?" Quarterly Journal of Economics, Vol. 112, pp. 169-215.
25. Kessides, I. N. (1990) "Market Concentration, Contestability and Sunk Costs", Review of Economics and Statistics, Vol. 72, pp. 614-622.
26. Leahy, J. V. (1993) "Investment in Competitive Equilibrium: the Optimality of Myopic Behavior", Quarterly Journal of Economics, Vol. 108, pp. 1105-1133.
27. _ and T. M. Whited (1996) "The Effect of Uncertainty on Investment: Some Stylized Facts", Journal of Money, Credit, and Banking, Vol. 28, pp. 65-83.
28. Matsubayashi, Y. (1995) "Expected Profit, Uncertainty, and Investment: a Japan-US Comparison", JCER Economic Journal, Vol. 28, pp. 31-52 (in Japanese).
29. McDonald, R. and D. Siegel (1986) "The Value of Waiting to Invest", Quarterly Journal of Economics, Vol. 101, pp. 707-728.
30. Miyagawa, T. (1996) "Volatility of Exchange Rate and Investment", mimeo.
31. Nishimura, K. G., Ohkusa, Y. and K. Ariga (1997) "Estimating Mark-up Marginal Cost: A Panel Analysis of Japanese Firms 1971-1994", mimeo.
32. Ogawa, K. and K. Suzuki (1994) "The Structure of Adjustment Costs and Investment Behavior under Uncertainty in Heavy Industry: Evidence from Japanese Panel Data", JDB Discussion Paper Series no. 9402, Tokyo: Research Institute of Capital Formation, Japan Development Bank.
33. _ and K. Suzuki (1998) "Land Value and Corporate Investment: Evidence from Japanese Panel Data", Journal of the Japanese and International Economies, Vol. 12, pp. 232-249.
34. _, Kitasaka, S., Watanabe, T., Maruyama, T., Yamaoka, H. and Y. Iwata (1994) "Asset Markets and Business Fluctuations in Japan", Keizai Bunseki, no. 136, Tokyo: Economic Research Institute, Economic Planning Agency.
35. Otaki, M. (1997) "Does Uncertainty Theoretically Delay a Discrete Investment?" Discussion Paper Series no. F-59, Tokyo: Institute of Social Science, University of Tokyo.
36. Pindyck, R. S. (1988) "Irreversible Investment, Capacity Choice, and the Value of the Firm", American Economic Review, Vol. 78, pp. 969-985.
37. _ (1991) "Irreversibility, Uncertainty, and Investment", Journal of Economic Literature, Vol. 29, pp. 1110-1148.
38. _ (1993) "A Note on Competitive Investment under Uncertainty", American Economic Review, Vol. 83, pp. 273-277.
39. _ and A. Solimano (1993) "Economic Instability and Aggregate Investment", NBER Macroeconomics Annual, Vol. 8, pp. 259-303.
40. Ramey, G. and V Ramey (1995) "Cross-Country Evidence on the Link between Volatility and Growth", American Economic Review, Vol. 85, pp. 1138-1151.
41. Saito, M. and I. Tokutsu (1993) "Technology in the Manufacturing: An International Comparison", Working Paper no. 9308F, Kobe: School of Business Administration, Kobe University.
42. Suzuki, K. and K. Ogawa (1997) "Fluctuations of Land Price and Fixed Investment: An Analysis Based on the Japanese Manufacturing Firms", Keizai Kenkyu, Vol. 48, pp. 218-226.
43. Yoshikawa, H. and H. Ohara (1997) "Heisei Boom, Recession and Fixed Investment", IMES Discussion Paper 97-J-2, Tokyo: Institute for Monetary and Economic Studies, Bank of Japan (in Japanese).