The influence of investment lag on company value in a non-financing constrained region

ABSTRACT

We focus on the impact of the investment time lag on a company’s value. We set up the original model in the start-up phase and the mature phase, which reflects the effect of investment time lag on the company’s value without financing constraints. Furthermore, based on the model, we obtain the explicit expressions of the company’s value in the start-up phase and the mature phase. In the empirical analysis, considering financing costs, investment opportunities and cash flow, we use PVAR to investigate how investment time lag affects the company’s value.

KEYWORDS:

• Non-financing constraint
• investment lag
• company value

Acknowledgments

The article is supported by National Social Science Fund of China (No.19BGL002).

Disclosure statement

No potential conflict of interest was reported by the author(s).

Author Contributions

All authors made substantial contribution to this paper.2006200420082009200320031980202120002009

Additional information

Funding

This work was supported by theNational Social Science Fund of China [No. 19BGL002].