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The impact of the global financial crisis on the capital investment of small Dutch corporations.

Tjallinks, Meghan (2014) The impact of the global financial crisis on the capital investment of small Dutch corporations.

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Abstract:During the recent financial crisis, capital expenditures and capital investment decreased sharply. This paper examines the link between the financial crisis and the decrease in capital investment. Moreover, this paper also takes into account growth opportunities, the amount of bank debt available, cash flow and firm size into account in its analysis. The paper begins by describing the financial crisis itself and its effect on capital investment observed in other related studies. This follows into an assessment of capital investment of 56 Dutch small firms pre-, during-, and post-crisis (2006 -2012). First of all, important variables and determinants of components of capital investment are identified by means of related literature, after which these determinants are tested by means of the data provided by these firms. Weak relationships were found between total capital investment and the determinants bank debt, cash flow, firm’ size and growth opportunities. However, the variable bank debt did show strong results during the correlation analysis, which were in line with underlying literature. Therefore, further research is needed to confirm whether capital investment indeed has suffered due to financial crisis.
Item Type:Essay (Bachelor)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:International Business Administration BSc (50952)
Link to this item:http://purl.utwente.nl/essays/65329
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