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Hirokazu Mizobata
''Hiring, investments, and financial distress: evidence from a Panel VAR analysis of Japanese firms''
( 2015, Vol. 35 No.4 )
We analyse the dynamic interactions among investment, hiring, and financial distress using a panel vector auto-regression approach to identify the effect of one shock while other shocks remain constant. The results indicate that adjustments in capital and labour significantly interact with each other and that financial distress critically influences these two components. We conclude that firm's dynamic optimization problem should be understood by accounting for these three factors simultaneously.
Keywords: investment; labour demand; financial distress; panel VAR
JEL: G3 - Corporate Finance and Governance: General
J2 - Demand and Supply of Labor: General
Manuscript Received : Aug 07 2015 Manuscript Accepted : Dec 13 2015

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