DOES UNCERTAINTY AFFECT CORPORATE INVESTMENT DECISIONS? EVIDENCE FROM TURKISH FIRMS

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Tan Ö. F., Cavlak H., Cebeci Y., Güneş N.

Asian Academy of Management Journal of Accounting and Finance, cilt.18, sa.2, ss.87-107, 2022 (ESCI) identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 18 Sayı: 2
  • Basım Tarihi: 2022
  • Doi Numarası: 10.21315/aamjaf2022.18.2.5
  • Dergi Adı: Asian Academy of Management Journal of Accounting and Finance
  • Derginin Tarandığı İndeksler: Emerging Sources Citation Index (ESCI), Scopus, Business Source Elite, Business Source Premier, EconLit, MLA - Modern Language Association Database, Directory of Open Access Journals
  • Sayfa Sayıları: ss.87-107
  • Anahtar Kelimeler: Corporate investment, Turkey, uncertainty, world uncertainty index
  • Marmara Üniversitesi Adresli: Evet

Özet

In this study, we analyse the impact of uncertainty on the corporate investment of 164 Turkish manufacturing firms. The time covers the period from 2005 to 2019. Our results reveal that there is a negative association between corporate investment and uncertainty. Under uncertainty, firms opt to decline their investment. Additionally, financially constrained (non-dividend payers) firms are negatively affected more than financially unconstrained firms. The use of alternative measurements of uncertainty and investment ensures the validity of our results. Policymakers should deal with the uncertainty and implement economic policies to decrease the country’s risk premium.