Note: This table presents the results from estimating equation (1) for private firms as shown below: The dependent variable investment, $Ii,t$⁠, is measured by Capx/K, which is capital expenditures scaled by the beginning-of-period capital. The main independent variable, $Industry_qi,t−1$⁠, in columns 1 and 2 is the equal-weighted average of the beginning-of-period (equivalently, end of year t − 1) market-to-book ratio of public firms in the three-digit SIC industry to which the private firm belongs, and in columns 3 and 4 is the median value. All columns control for private firms’ own lagged CashFlow and Ln(Asset), and the average lagged CashFlow and Ln(Asset) of all private and public peers. Columns 2 and 4 further control for an extended set of lagged firm and industry characteristics (such as sales growth and leverage), lagged industry valuation, as well as peer firms’ average contemporaneous investments. All variable constructions are described in  Appendix A. All regression models are estimated with firm-fixed effects and year-fixed effects. Since the main right-hand-side variable is at the three-digit SIC industry level, t-statistics in parentheses are adjusted using the Huber–White estimator allowing within industry clusters. Coefficients significant at the 10 percent, 5 percent, and 1 percent levels are marked with *, **, and ***, respectively.