Effect of overinvestment on the relationship between NON_EX and RISK1
| Dependent variable RISK1 | Overinvesting firms | Underinvesting firms | ||
|---|---|---|---|---|
| (Measure 1) | (Measure 2) | (Measure 1) | (Measure 2) | |
| NON_EX | 0.00596* (1.72) | 0.00776** (2.39) | 0.00837*** (2.96) | 0.0116*** (3.79) |
| FSIZE | −0.00382** (−2.48) | −0.00372*** (−3.15) | −0.00167* (−1.66) | −0.00118 (−0.79) |
| PB | −0.000491 (−1.01) | 0.000377 (0.80) | 0.000113 (0.20) | 0.000358 (0.83) |
| STDEBT | −0.0000638 (−0.02) | 0.000471 (0.17) | 0.000111 (0.05) | −0.00383 (−1.53) |
| CAPEX | 0.0195*** (2.81) | 0.0145** (2.19) | −0.00178 (-0.19) | −0.00391 (−0.46) |
| CASH | 0.00883** (2.20) | 0.0101** (2.27) | −0.00115 (−0.37) | −0.00285 (−0.91) |
| DIV | −0.00216 (−0.23) | −0.0229** (−2.34) | −0.0174* (−1.75) | −0.0123 (−1.31) |
| NON_EX*CAPEX | −0.0228** (−2.26) | −0.0188** (−2.13) | 0.00530 (0.38) | 0.00330 (0.24) |
| Constant | 0.0798*** (3.89) | 0.0775*** (5.02) | 0.0532*** (3.92) | 0.0466** (2.30) |
| Year fixed | Yes | Yes | Yes | Yes |
| Firm fixed | Yes | Yes | Yes | Yes |
| Model fits | ||||
| Within R2 | 0.2569 | 0.2766 | 0.1858 | 0.2213 |
| Between R2 | 0.1726 | 0.1965 | 0.2540 | 0.0896 |
| Overall R2 | 0.2203 | 0.2229 | 0.2123 | 0.1704 |
| F-statistics | 9.38*** | 10.52*** | 9.60*** | 7.25*** |
| Obs | 501 | 685 | 764 | 675 |
| Dependent variable RISK1 | Overinvesting firms | Underinvesting firms | ||
|---|---|---|---|---|
| (Measure 1) | (Measure 2) | (Measure 1) | (Measure 2) | |
| NON_EX | 0.00596* (1.72) | 0.00776** (2.39) | 0.00837*** (2.96) | 0.0116*** (3.79) |
| FSIZE | −0.00382** (−2.48) | −0.00372*** (−3.15) | −0.00167* (−1.66) | −0.00118 (−0.79) |
| PB | −0.000491 (−1.01) | 0.000377 (0.80) | 0.000113 (0.20) | 0.000358 (0.83) |
| STDEBT | −0.0000638 (−0.02) | 0.000471 (0.17) | 0.000111 (0.05) | −0.00383 (−1.53) |
| CAPEX | 0.0195*** (2.81) | 0.0145** (2.19) | −0.00178 (-0.19) | −0.00391 (−0.46) |
| CASH | 0.00883** (2.20) | 0.0101** (2.27) | −0.00115 (−0.37) | −0.00285 (−0.91) |
| DIV | −0.00216 (−0.23) | −0.0229** (−2.34) | −0.0174* (−1.75) | −0.0123 (−1.31) |
| NON_EX*CAPEX | −0.0228** (−2.26) | −0.0188** (−2.13) | 0.00530 (0.38) | 0.00330 (0.24) |
| Constant | 0.0798*** (3.89) | 0.0775*** (5.02) | 0.0532*** (3.92) | 0.0466** (2.30) |
| Year fixed | Yes | Yes | Yes | Yes |
| Firm fixed | Yes | Yes | Yes | Yes |
| Within | 0.2569 | 0.2766 | 0.1858 | 0.2213 |
| Between | 0.1726 | 0.1965 | 0.2540 | 0.0896 |
| Overall | 0.2203 | 0.2229 | 0.2123 | 0.1704 |
| 9.38*** | 10.52*** | 9.60*** | 7.25*** | |
| Obs | 501 | 685 | 764 | 675 |
Note(s): Variables are defined the same as in Table 2. Robust t-statistics adjusted for firm-level clustering are reported in parentheses. ***, ** and * denote significance at the 1%, 5% and 10% levels, respectively
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