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Chinese Journal of Management Science ›› 2008, Vol. 16 ›› Issue (3): 145-150.

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Measuring Financial Constraint with a Multivariate Classification Index Model

LI Yan, ZHANG Ning   

  1. Business School, Renmin University of China, Beijing 100872, China
  • Received:2007-09-17 Revised:2008-05-25 Online:2008-06-30 Published:2008-06-30

Abstract: There has been a strong argument on cash-investment sensitivity which is regarded as the measurement of financial constraint since Kaplan and Zingales's discussion in 1997.Following the basic approach by them,in this paper we developed a multivariate classification index model to measure firm's financial constraint,with listed company in China.

Key words: financial constraint, multivariate classification index model, cash-investment sensitivity

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