For corporations that are young and do not have strong bank relationships—such as the fast-growing but underfunded private sector in China—it may be the only option. Therefore corporations typically invest substantially more only when they grow faster, with their saved profits financing investment. The producer-biased strategy facilitates this kind of growth because the surplus value generated by the economy is allocated directly to producers, enhancing their profits and their ability to invest, instead of winding its way circuitously through households and a financial system that is incapable
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in developing economies, corporations may find it's too expensive to borrow, so investment may be driven by those that are growing the fastest. good for a while but run the risk of growing to overcapacity/till profits disappear (if they don't know when to stop investing) (e.g. East Asian developing countries in the 1990s).
