01920cas a2200265 a 4500 AALejournalIMF016491 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513539935 1018-5941 BD-DhAAL BD-DhAAL Li, Delong. Corporate Investment in Emerging Markets : Financing vs. Real Options Channel / Delong Li, Nicolas Magud, Fabian Valencia. Washington, D.C. : International Monetary Fund, 2015. 1 online resource (30 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students We examine how firm and country heterogeneity shape the response of corporate investment in emerging markets to changes in global interest rates and volatility. We test for the presence of (i) a financing channel originating from changes in the costs of external borrowing and (ii) a real options channel-reflecting firms' option values to delay investment. We find evidence of the coexistence of both channels. Financially weaker firms reduce investment by more in response to higher interest rates or volatility, while firms with stronger balance sheets become less willing to invest after volatility spikes. Furthermore, the intensity of the financing channel diminishes for firms in countries with lower public debt, higher foreign reserves, or deeper financial markets. Mode of access: Internet Magud, Nicolas. Valencia, Fabian. IMF Working Papers; Working Paper ; No. 2015/285 Full text available on IMF http://elibrary.imf.org/view/journals/001/2015/285/001.2015.issue-285-en.xml IMF e-Library