The Lahore Journal
of Business

The Lahore Journal
of Business

Lahore Journal of Business

(HEC recognized journal in “Y” category)

The Lahore Journal of Business is aimed at providing a specialized forum for dissemination of qualitative and quantitative research in various areas of business administration. The LJB invites researchers, policy makers and analysts to submit original theoretical and empirical papers that explore and contribute to the understanding of various areas in the business domain. The Journal aims at bringing together state-of-art research findings, particularly from emerging markets, in various business disciplines including (but not limited to) accounting, banking, management, marketing, finance, investments, human resource management and organizational behavior.

Syed Sikander Ali Shah, Dr. Ali Murad Syed and Sana Sheikh

This study examines the potential interaction of a firm’s financing and investment decisions. It studies broadly how firms manage underinvestment and liquidity risks. To estimate the effects of these decisions, the study has incorporated four simultaneous equations using the partial dynamic adjustment model. Panel data of non-financial Pakistani firms have been used in this study. The findings of this study demonstrate that Pakistani high growth firms depend on high-leverage strategies and give greater importance to underinvestment risk rather than liquidity risk. Furthermore, growing Pakistani firms are not adopting low-leverage strategies ex ante to participate in future growth opportunities ex post. This study also examines whether or not Pakistani firms are paying special attention to the mixing of debt maturity that affects the firm’s investment decisions and its value.