of investment requires a new idea, an "option". When options are scarce, new capital is harder to put in place and the … gradually, as options are used up. Because investment represents an exercise of options, it has an intertemporal substitution …

We develop a model of investment with financial constraints and use it to investigate the relation between investment … between q and investment, relative to the frictionless benchmark. We present a calibrated version of the model, which, due to … this effect, generates realistic correlations between investment, q, and cash flow …

shareholders and managers in which managers have private benefits or private costs of investment. Managers overinvest when they … compensation, investment, and firm performance for both cases. The relationship between firm performance and managerial incentives …, in isolation, is insufficient to identify whether managers have private benefits or private costs of investment. In order …

We analyze private fixed investment in the U.S. over the past 30 years. We show that investment is weak relative to … two broad categories of explanations: theories that predict low investment because of low Q, and theories that predict low … investment despite high Q. We argue that the data does not support the first category, and we focus on the second one. We use …

We examine how credit constraints affect the cyclical behavior of productivity-enhancing investment and thereby … volatility and growth. We first develop a simple growth model where firms engage in two types of investment: a short-term one and … a long-term productivity-enhancing one. Because it takes longer to complete, long-term investment has a relatively less …

We study the effects of monetary-policy-induced changes in Tobin's q on corporate investment and capital structure. We … evidence, and quantify the relevance for monetary transmission to aggregate investment …

's q theory of investment. As Tobin has explained, aggregate investment can be expected to depend in a stable way on q, the … return on physical capital raise its market value and cause increased investment until equilibrium is restored. Although … models linking the stock market to investment have been estimated, they have not previously been used to examine the impact …

We study how investors' preferences for robustness influence corporate investment, financing, and compensation … ambiguity aversion lowers Tobin's q; the average investment, and investment volatility. The entrepreneur values the project at …