000 01118nam a22001697a 4500
008 190323b xxu||||| |||| 00| 0 eng d
022 _a0304-405X
245 _aThe effects of q and cash flow on investment in the presence of measurement error / by Andrew B. Abel
_cAndrew B. Abel
260 _aAmsterdam
_bElsevier
_cMay 2018
300 _aPages 363-377
440 _aJournal of Financial Economics
_v128 (2)
_x0304-405X
500 _aAbstract I analyze investment, q, and cash flow in a tractable stochastic model in which marginal q and average q are identically equal. I introduce classical measurement error and derive closed-form expressions for the coefficients in regressions of investment on q and cash flow. The cash-flow coefficient is positive and larger for faster growing firms, yet there are no financial frictions in the model. I develop the concepts of bivariate attenuation and weight shifting to interpret the estimated coefficients on q and cash flow in the presence of measurement error.
690 _aInvestment
690 _aCash flow q
690 _aMeasurement error
942 _2lcc
_cSE
999 _c361357
_d361357