|This paper explores the impact of Tobin’s average 𝑞 as a proxy for corporate investment opportunities
on the Swedish market. The study takes a longitudinal approach studying 161 firms over the period
2010–2017. Investments were calculated as growth in net property, plant and equipment. The
conclusion echoes the literature in that 𝑞 is found to be significantly and positively related to the
corporate investment rate. Its coefficient, in the linear regression model, is small as well as its
correlation coefficient, however, pointing to a rather weak impact on investment. By further exploring
the 𝑞 model and its implications on the Swedish market, this paper contributes to the already existing
literature and empirical evidence concerned with Tobin’s 𝑞 as a proxy for investment opportunity.
Much more research is still to be done on the Swedish market, exploring Tobin’s 𝑞 and its relationship
with corporate investment.
|Industriell och finansiell ekonomi
|Tobin’s q, corporate investment, investment opportunity, longitudinal study, Sweden, growth in PPE
|Tobin´s q & Corporate Investment Opportunities in Sweden - A longitudinal study
|University of Gothenburg/Department of Business Administration
|Göteborgs universitet/Företagsekonomiska institutionen