Arbeitspapier

Capital Adjustment Patterns in Swedish Manufacturing Firms: What Model do they Suggest?

In this paper we study the capital adjustment process in Swedish manufacturing firms and relate the empirical findings to standard models of firm behavior in the presence of impediments to capital adjustments. We find that (i) a model with irreversible capital goes a very long way in capturing the salient features of firm-level capital adjustment behavior. To see this, an integrated approach is necessary since different alternative models do well in certain comparative dimensions but not in others. (ii) The partial adjustment model generally fails to explain capital adjustment patterns. (iii) The capital accumulation process is a highly volatile and non-persistent process on the firm-level. (iv) Firms adjustment behavior is asymmetric in that they are more likely to tolerate excess capital than shortages of capital, and finally, (v) the estimated adjustment function implies that aggregate investment is relatively unresponsive to aggregate shocks in deep recessions as compared to the responsiveness in normal times.

Sprache
Englisch

Erschienen in
Series: Working Paper ; No. 2001:15

Klassifikation
Wirtschaft
Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
Investment; Capital; Intangible Capital; Capacity
Industry Studies: Manufacturing: General
Thema
Investment
Irreversibilities
Lumpiness
Manufacturing
Investition
Anpassungskosten
Schätzung
Verarbeitendes Gewerbe
Schweden

Ereignis
Geistige Schöpfung
(wer)
Carlsson, Mikael
Laséen, Stefan
Ereignis
Veröffentlichung
(wer)
Uppsala University, Department of Economics
(wo)
Uppsala
(wann)
2001

Handle
Letzte Aktualisierung
10.03.2025, 11:43 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Carlsson, Mikael
  • Laséen, Stefan
  • Uppsala University, Department of Economics

Entstanden

  • 2001

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