In standard monetary models nominal interest rates should be decreased in response to a switch to a lower inflation … target. This paper considers this interaction between inflation and nominal interest rates in a dynamic model of liquidity … urgently need it and saves for those who do not. I show when a lower inflation target requires a higher nominal interest rate …

aggregate investment,and help propagate over time shocks affecting the economy. Our findings are as follows. First, we find that …

We develop a model of investment with financial constraints and use it to investigate the relation between investment … correlation between q and investment. We calibrate the model and show that, thanks to this effect, the model can generate … realistic correlations between investment, q and cash flow …

This paper investigates the role of financial market frictions on investment and the price of financial asset. We show … investigate the effects of financing constraints on firm level investment behavior. Specifically we derive explicit relations … between investment and Tobin’s q in the presence of financial market imperfections. We show that this relation depends not …

The impact of imperfections in financial markets on firm-level investment varies greatly across industries. In …