Since the end of the 1970s much discontent has been expressed about a decrease in capital expenditures by Western companies . This investment gap - measured by corporate investment as a declining percentage of GNP- is cause for concern, and reflects a low level of innovation. Clearly, during the period under consideration, Western companies did not find enough opportunities for capital expenditures that would have yielded higher returns than they anticipated from investing the money in the financial markets . The low level of innovation and the resulting investment gap led not only to lower economic growth rates but also hindered structural change. One possible reason for this development is related to the conditions under which managers are willing to take risks . Investments and innovations are generally accompanied by high risks and uncertain returns. The relationship between investment and innovation gaps, an the one hand, and expected
profits and equity capital, an the othet, is extensively covered in the literature, which presumes a positive correlation between the willingness to take risks and profit expectations .This assumption is also posThis assumption is also postulated in the Portfolio-Selection-Theory.6 Similarly, in the Risk-Analysis-Model of D.B. Hertz a positive correlation between profit expectation and a risktaking attitude is assumed.
| Identifer | oai:union.ndltd.org:DRESDEN/oai:qucosa:de:qucosa:15270 |
| Date | 23 June 2017 |
| Creators | Löbler, Helge, Perlitz, Manfred |
| Publisher | Wiley, Universität Leipzig, Universität Mannheim |
| Source Sets | Hochschulschriftenserver (HSSS) der SLUB Dresden |
| Language | English |
| Detected Language | English |
| Type | info:eu-repo/semantics/acceptedVersion, doc-type:article, info:eu-repo/semantics/article, doc-type:Text |
| Rights | info:eu-repo/semantics/openAccess |
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