Regression results between private firms’ investment opportunities and firm performance: alternative proxies for firm performance and investment opportunities
| Panel A: alternative proxies for firm performance | |||||||
|---|---|---|---|---|---|---|---|
| Predicted sign | Dependent variable = Firm performance (PERF2) | Dependent variable = Firm performance (PERF3) | |||||
| Model (1) | Model (2) | Model (3) | Model (4) | Model (5) | Model (6) | ||
| INVOP | + | 0.062*** | 0.054*** | 0.071*** | 0.022** | 0.019* | 0.052*** |
| (4.188) | (3.376) | (3.293) | (2.346) | (1.797) | (4.023) | ||
| INVOP × FEMOWN | + | – | 0.024** | – | – | 0.010 | – |
| (2.228) | (0.701) | ||||||
| INVOP × CONTROL | – | – | – | −0.012 | – | – | −0.042*** |
| (−0.607) | (−2.625) | ||||||
| FEMOWN | ? | 0.002 | −0.017* | 0.002 | 0.000 | −0.007 | 0.000 |
| (0.743) | (−1.883) | (0.746) | (0.023) | (−0.612) | (0.033) | ||
| CONTROL | – | 0.004 | 0.004 | 0.013 | −0.010*** | −0.010*** | 0.021* |
| (1.172) | (1.159) | (0.875) | (−3.468) | (−3.473) | (1.699) | ||
| Intercept | ? | 0.260*** | 0.266*** | 0.254*** | 0.042 | 0.045 | 0.021 |
| (15.697) | (15.607) | (12.516) | (0.901) | (0.949) | (0.440) | ||
| Control variables | Yes | Yes | Yes | Yes | Yes | Yes | |
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Industry fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Country fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Observations | 35,155 | 35,155 | 35,155 | 35,136 | 35,136 | 35,136 | |
| R-squared | 0.084 | 0.084 | 0.084 | 0.071 | 0.071 | 0.072 | |
| Panel A: alternative proxies for firm performance | |||||||
|---|---|---|---|---|---|---|---|
| Predicted sign | Dependent variable = Firm performance ( | Dependent variable = Firm performance ( | |||||
| Model (1) | Model (2) | Model (3) | Model (4) | Model (5) | Model (6) | ||
| + | 0.062*** | 0.054*** | 0.071*** | 0.022** | 0.019* | 0.052*** | |
| (4.188) | (3.376) | (3.293) | (2.346) | (1.797) | (4.023) | ||
| + | – | 0.024** | – | – | 0.010 | – | |
| (2.228) | (0.701) | ||||||
| – | – | – | −0.012 | – | – | −0.042*** | |
| (−0.607) | (−2.625) | ||||||
| ? | 0.002 | −0.017* | 0.002 | 0.000 | −0.007 | 0.000 | |
| (0.743) | (−1.883) | (0.746) | (0.023) | (−0.612) | (0.033) | ||
| – | 0.004 | 0.004 | 0.013 | −0.010*** | −0.010*** | 0.021* | |
| (1.172) | (1.159) | (0.875) | (−3.468) | (−3.473) | (1.699) | ||
| Intercept | ? | 0.260*** | 0.266*** | 0.254*** | 0.042 | 0.045 | 0.021 |
| (15.697) | (15.607) | (12.516) | (0.901) | (0.949) | (0.440) | ||
| Control variables | Yes | Yes | Yes | Yes | Yes | Yes | |
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Industry fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Country fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Observations | 35,155 | 35,155 | 35,155 | 35,136 | 35,136 | 35,136 | |
| 0.084 | 0.084 | 0.084 | 0.071 | 0.071 | 0.072 | ||
| Panel B: alternative proxies for investment opportunities | |||||||
|---|---|---|---|---|---|---|---|
| Predicted sign | Dependent variable = Firm performance (PERF1) | ||||||
| Model (1) | Model (2) | Model (3) | Model (4) | Model (5) | Model (6) | ||
| INVOP | + | 0.026*** | 0.019*** | 0.038*** | 0.025*** | 0.022*** | 0.036*** |
| (4.607) | (3.769) | (4.173) | (4.522) | (4.071) | (4.109) | ||
| INVOP × FEMOWN | + | – | 0.022*** | – | – | 0.009 | – |
| (4.936) | (1.565) | ||||||
| INVOP × CONTROL | – | – | – | −0.016* | – | – | −0.016** |
| (−1.981) | (−2.004) | ||||||
| FEMOWN | ? | 0.001 | −0.011** | 0.001 | 0.001 | −0.004 | 0.001 |
| (0.237) | (−2.307) | (0.255) | (0.238) | (−0.772) | (0.244) | ||
| CONTROL | – | −0.005 | −0.005 | 0.003 | −0.005 | −0.005 | 0.004 |
| (−1.466) | (−1.470) | (0.618) | (−1.452) | (−1.447) | (0.753) | ||
| Intercept | ? | 0.314*** | 0.318*** | 0.309*** | 0.311*** | 0.312*** | 0.304*** |
| (6.079) | (6.136) | (5.994) | (5.998) | (6.016) | (5.860) | ||
| Control variables | Yes | Yes | Yes | Yes | Yes | Yes | |
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Industry fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Country fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Observations | 36,185 | 36,185 | 36,185 | 36,185 | 36,185 | 36,185 | |
| R-squared | 0.090 | 0.090 | 0.090 | 0.090 | 0.090 | 0.090 | |
| Panel B: alternative proxies for investment opportunities | |||||||
|---|---|---|---|---|---|---|---|
| Predicted sign | Dependent variable = Firm performance ( | ||||||
| Model (1) | Model (2) | Model (3) | Model (4) | Model (5) | Model (6) | ||
| + | 0.026*** | 0.019*** | 0.038*** | 0.025*** | 0.022*** | 0.036*** | |
| (4.607) | (3.769) | (4.173) | (4.522) | (4.071) | (4.109) | ||
| + | – | 0.022*** | – | – | 0.009 | – | |
| (4.936) | (1.565) | ||||||
| – | – | – | −0.016* | – | – | −0.016** | |
| (−1.981) | (−2.004) | ||||||
| ? | 0.001 | −0.011** | 0.001 | 0.001 | −0.004 | 0.001 | |
| (0.237) | (−2.307) | (0.255) | (0.238) | (−0.772) | (0.244) | ||
| – | −0.005 | −0.005 | 0.003 | −0.005 | −0.005 | 0.004 | |
| (−1.466) | (−1.470) | (0.618) | (−1.452) | (−1.447) | (0.753) | ||
| Intercept | ? | 0.314*** | 0.318*** | 0.309*** | 0.311*** | 0.312*** | 0.304*** |
| (6.079) | (6.136) | (5.994) | (5.998) | (6.016) | (5.860) | ||
| Control variables | Yes | Yes | Yes | Yes | Yes | Yes | |
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Industry fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Country fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | |
| Observations | 36,185 | 36,185 | 36,185 | 36,185 | 36,185 | 36,185 | |
| 0.090 | 0.090 | 0.090 | 0.090 | 0.090 | 0.090 | ||
Note(s): Superscript ***, **, and * represent statistical significance at the 1, 5 and 10% levels, respectively, two-tailed. Coefficient values (robust t-statistics) are shown with standard errors clustered at the country level. Descriptions of variables are provided in Appendix
Source(s): Authors’ own work
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