Incomplete markets, intra-industry firm heterogeneity and investment. The case of uranium exploration
We argue that as a result of incomplete factor markets, firm-specific variables representing selected characteristics of firms may influence and differentiate firms' investment behavior within industries. This paper operationalizes and test the framework with a simple, institutionally motivated model of investment in uranium exploration. Our results suggest that cash flow and firm-specific expertise influence and differentiate firms' exploration investment behavior in the uranium industry. These findings imply that the ways in which incomplete factor input markets distinguish firms also influence and differentiate their investment behavior. © 1990.
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