Chari, Anusha (contributor); Henry, Peter Blair (contributor) - 2007
IMF Annual Research Conference, UCLA, WFA, and
the World Bank. Any errors remaining are our own.
1
Abstract
In … asset pricing world, a change in a firm’s stock price reflects a change in
either or both of the following: (a) the firm … rest of the world. All else equal, the common shock to the cost of capital
will increase the average investment rate of …