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Export Reference (APA) 
Barradas, R. (2015). Financialisation and Real Investment in the European Union Using a Country-Level Analysis: Beneficial or Prejudicial Effects?. Dinâmia’CET-IUL Working Paper Nº 2015/10. 1-40
Export Reference (IEEE) 
R. P. Barradas,  "Financialisation and Real Investment in the European Union Using a Country-Level Analysis: Beneficial or Prejudicial Effects?", in Dinâmia’CET-IUL Working Paper Nº 2015/10, Lisboa, pp. 1-40, 2015
Export BibTeX 
@unpublished{barradas2015_1764937781417,
	author = "Barradas, R.",
	title = "Financialisation and Real Investment in the European Union Using a Country-Level Analysis: Beneficial or Prejudicial Effects?",
	year = "2015",
	url = "https://repositorio.iscte-iul.pt/bitstream/10071/10752/1/DINAMIA_WP_2015-10.pdf"
}
Export RIS 
TY  - EJOUR
TI  - Financialisation and Real Investment in the European Union Using a Country-Level Analysis: Beneficial or Prejudicial Effects?
T2  - Dinâmia’CET-IUL Working Paper Nº 2015/10
AU  - Barradas, R.
PY  - 2015
SP  - 1-40
DO  - 10.15847/dinamiacet-iul.wp.2015.10
CY  - Lisboa
UR  - https://repositorio.iscte-iul.pt/bitstream/10071/10752/1/DINAMIA_WP_2015-10.pdf
AB  - This paper makes an empirical assessment of the relationship between financialisation and real
investment by non-financial corporations using panel data composed of 27 European Union
countries over 19 years (from 1995 to 2013). On one hand, financialisation leads to a rise in
financial investments, deviating funds from real investments (“crowding out” effect). On the
other, pressures from shareholders to intensify financial payments restrict the funds available for
new real investments. We estimate an aggregate investment equation with the traditional
variables (profitability, debt, cost of capital, savings rate and output growth) and two further
measures of financialisation (financial receipts and financial payments). Findings show that
financialisation has damaged real investment in European Union countries, mainly through the
channel of financial payments either in interest or dividend payments. It is also found that the
prejudicial effects of financialisation in investment are more marked in more financialised
countries. In addition, it is concluded that debt has a harmful effect on real investment as the
increasing levels of non-financial corporations' indebtedness prevent the use of new debts to
finance real investments.
ER  -