Table 2: Definitions of research variables.

VariableDefinitionCalculation method

is the actual rate of return in an accounting year, and is benchmark rate of return is the actual annual rate of return on the stock with dividend included in the return, and is the circulation-market-value-weighted actual annual rate of return on the industry
Earnings
Net assetDifference between total assets and cash assets
Interest expenseMeasured by financial expenses
Common stock dividendsMeasured by cash dividends
Cash at previous year end
Market value financial leverageTotal liabilities/total asset
Net financingNet cash inflow from financing
HighHigh financial constraintsTakes 1 for the top 20% ASY values, 0 for others
LowLow financial constraintsTakes 1 for the bottom 20% ASY values, 0 for others