Drivers of Corporate Investment in India: Assessing the Impact of Monetary Policy and COVID

Empirical investigation finds that firm-specific factors, namely deleveraging of balance sheets, comfortable cash flows and improving debt servicing capacity impact fixed investment in private corporate sector positively. Monetary policy impacts fixed assets investment growth of financially constrai...

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Bibliographic Details
Published inSouth Asia economic journal (Institute of Policy Studies) Vol. 24; no. 2; pp. 216 - 251
Main Authors Gupta, Kashyap, Kumar, Sunil, Gulati, Sarthak
Format Journal Article
LanguageEnglish
Published New Delhi, India SAGE Publications 01.09.2023
SAGE PUBLICATIONS, INC
Subjects
Assets
Companies
Investments
Monetary policy
India
macroeconomics
Economic policy
firm performance
financial investment/analysis
India
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Summary:Empirical investigation finds that firm-specific factors, namely deleveraging of balance sheets, comfortable cash flows and improving debt servicing capacity impact fixed investment in private corporate sector positively. Monetary policy impacts fixed assets investment growth of financially constrained firms more compared to non-financially constrained firms. Furthermore, the impact of COVID pandemic on investment was more adverse in case of weak firms. JEL Codes: G3, E22, O16, E52
ISSN:1391-5614
0973-077X
DOI:10.1177/13915614231192775