The relation between investment and cash flow: Evidence from Vietnam’s listed companies

Abstract

The paper refers to the relation between investment and cash flow in Vietnam –a small transitional economy. We have conducted an unbalanced panel data of 3,366 observations from listed companies in Vietnam’ s stock exchanges and we find a U -shaped relation between investment and cash flow by GLS method. The relation is applied to state –controlled enterprises and state-uncontrolled enterprises. However, the relation is not appropriate to companies that have high potential of growth but it exists in companies that have low potential of growth. It is suggested that companies with low potential of growth have the source of investment mainly from their internal cash flows.

Keywords

• đầu tư của doanh nghiệp
• dòng tiền
• nhà nước kiểm soát
• tiềm năng tăng trưởng
• việt nam