The Investment Process in the Mexican Industry: The Case of Mexican Chemical Petrochemical Complex
Leticia Armenta *
Department of Economics, Tec de Monterrey, Mexico City Campus, Calle del Puente 2, Col. Ejidos de Huipulco Tlalpan, zip code 14380 Mexico, D.F, Mexico
Edgar Nuñez
GM Analyst, Forecast and Market Analysis, Av. Ejército Nacional 843, Col. Granada, zip code 11520, México, D.F, Mexico
*Author to whom correspondence should be addressed.
Abstract
Abstract: The aim of this paper is to analyze the investment process of the mexican chemical petrochemical industry (CQP). In order to do it we take the defined complex following Lifschitz and Zottele [1] methodology and we apply a tobin’s q model with uncertainty following bo [2] proposal. the main conclusions of the study are: q theory model behaves pretty good to explain investment process in the mexican CQP; tobin’s q is a very important factor of the investment process; every percent change of q increases investment between 2% to 5%; uncertainty negatively affects CQP investment from -0.6% to -2% for one percent change in gross profit. One of the contributions of the paper is the application of q model at industry level.
Keywords: Petrochemical industry, investment, q model, mexican economy