Financialization, financial assets and productive investment in Latin America: evidence from large public listed companies 1995–2015

ZEOLLA, NICOLAS HERNÁN; SANTARCÁNGELO, JUAN E.

JOURNAL OF POST KEYNESIAN ECONOMICS

Routledge

Lugar: Nueva York; Año: 2023

0160-3477

Using firm-level data from public listed large non-financial corporations (NFC) this paper studies the impact of financialization on productive investment in Latin America in the last two decades. After considering the main stylized facts on investment, profits and financial incomes from balance sheet information, we estimate an econometric model of investment determinants to measure the impact of financialization over large NFC. Similar to developed economies, evidence suggest that dividends payments and financial income has negative affect investment. But, in Latin America, restricted only for large and very large firms. Besides this, we also registered that non-current financial assets holding negatively affects productive investment. This seems to be especially relevant in the context of the carry trade boom in the region after 2009. These findings provide new insights on the negative effects of the international dimension of financialization on emerging countries productive investment.