This Paper examines how the investment of financially constrained firms varies with their level of internal funds. We … develop a theoretical model of optimal investment under financial constraints. Our model endogenizes the costs of external … investment is U-shaped. In particular, when a firm’s internal funds are negative and sufficiently low, a further decrease leads …

Which investment model best fits firm-level data? To answer this question we estimate alternative models using … implication, that Q is a sufficient statistic for determining a firm's investment decision, has been often rejected because cash …-flow and lagged-investment effects are present in investment regressions. However, we find that these regression results are …

The best predictor of current investment at the firm level is lagged investment. This lagged-investment effect is … empirically more important than the cash-flow and Q effects combined. We show that the specification of investment adjustment … costs proposed by Christiano, Eichenbaum and Evans (2005) predicts the presence of a lagged-investment effect and that a …

investment (FDI) are most likely to take place through contacts between MNCs and their local suppliers, our finding suggests that …

managerial agency problem correctly. Our theory assumes that strict corporate governance prevents managers from diverting cash …

This Paper shows how microeconomic data on investment plans can be used to study the structure of risk faced by firms …. Revisions of investment plans form a martingale, and thus reveal the underlying shocks driving investment. We decompose … revisions in investment plans into micro, sector and aggregate shocks, and exploit stock market data to distinguish between …

In markets with imperfect information and heterogeneity, the information technology affects the rate at which agents …

This paper examines heterogeneity in price stickiness using a large, original, set of individual price data collected …. The main findings are the following: i) cross-product and cross-outlet-type heterogeneity is pervasive, both in the shape …