We provide theoretical and empirical evidence that policy uncertainty can significantly affect firm level investment … theory-based measure of policy uncertainty. Our novel approach using observable trade policies allows us to estimate the … and entry decisions in the context of international trade. When market entry costs are sunk, policy uncertainty can create …

This Paper investigates the empirical relationship between uncertainty and investment dynamics. This is motivated by … can be detected as a smaller impact of sales growth on investment for firms facing higher uncertainty. Using a stock … the real options literature, which suggests a weaker response of investment to demand shocks at higher levels of …

their growth. Economic theory suggests uncertainty can cause firms to delay investments until uncertainty is resolved. We … that, contrary to what they profess, macroeconomic and political risk is not inhibiting the investment behavior of …Firms in many developing countries cite macroeconomic instability and political uncertainty as major constraints to …

between risk and uncertainty is implemented by applying the Gilboa-Schmeidler maxmin with multiple priors framework to lenders …, ultimate lenders and financial intermediaries. The model is used to investigate the impact of uncertainty about the likelihood … include: (i) An unanticipated increase in bailout uncertainty raises interest rates, the volume of defaults in both the real …

relative to the present is reduced. Hence, due to a rise in terror activity, investment goes down, and in the long run income … and welfare. Next, we show that this theory of terror and the economy helps to understand changes in trend and business …

and investment, so it may take some time before an unemployed worker finds a job. Wages are determined by bargaining. A … subsidize entrepreneurial investment (there is a wage bargaining distortion and a search externality), simulations show that the …

fertility, and lower investment in physical and human capital. Furthermore, the feedback effect from economic prosperity to …

and investment. When the share of output that accrues to the owners of natural resources rises, the demand for capital … allocation of capital may, however, enhance the quantity as well as the quality of new investment and sustain growth. Empirical … thereby inhibiting economic growth. The results also suggest that abundant natural resources may hurt saving and investment …

country risk. Increased political instability increases the equilibrium loan size in the first regime and decreases it in the … predicted by the theory. …

Using firm-level data, we provide evidence that, although monetary policy affects real investment, the effect operates …