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Liquidity, profitability and business investment.

Publication: International Advances in Economic Research
Publication Date: 01-AUG-08
Format: Online
Delivery: Immediate Online Access
Full Article Title: Liquidity, profitability and business investment.(Report)

Article Excerpt
The purpose of this study is to examine the role of liquidity variables in explaining firm investment. Based on goodness of fit criteria, the study finds a model incorporating both liquidity and profitability variables performs better than the leading profitability-based models used in empirical research. In turn, liquidity flow measures perform better than do measures of liquidity stock.

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