The Impact of Perceived Expectations and Uncertainty on Firm Investment

M.J.J. Koetse, A.J. van der Vlist, H.L.F. de Groot

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Abstract

This paper analyses the (differential) impact of perceived expectations and uncertainty on investment spending in small and large firms. We analyse two types of investment, viz. aggregate investment and investment in energy-saving technologies, using Dutch firm level data. The results show that expectations and uncertainty about input- and output prices and domestic demand have substantial but different effects on investment spending in firms of different sizes. Furthermore, we find evidence, at least for small firms, that there are important differences between the effects of uncertainty about input and output variables. © Springer 2006.
Original languageEnglish
Pages (from-to)365-376
Number of pages12
JournalSmall Business Economics
Volume26
Issue number4
DOIs
Publication statusPublished - 2006

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