INVESTMENT AND EXPORT-LED INDUSTRIALIZATION: FINANCIAL CONSTRAINTS AND EXPORT PROMOTION OF EAST ASIAN FIRMS

Abstract

This paper aims to empirically examine the determinants that influence the investment decisions of firms in East Asia, a region that propelled its growth through a predominantly export-led industrialization strategy. Empirical results suggest that a firm¡¯s cash flow, representing internal funding capability, have significantly positive relationship on firm investment decisions in all the sample countries in the region. In addition, the study found that export expansion led to increasing internal funding capability, which had a positive influence on the firm¡¯s investment decision.Corporate Finance, East Asia, Investment