one type of capital good to save and invest in, fixed capital investment dynamics are tightly linked to consumption … dynamics, which are similar across lumpy and frictionless investment models. With capital goods heterogeneity, households … capital adjustment frictions. We quantify our arguments by introducing inventories into a two-sector lumpy investment model …

The sensitivity of U.S. aggregate investment to shocks is procyclical: the initial response increases by approximately … counterexample to the claim that microeconomic investment lumpiness is inconsequential for macroeconomic analysis …

The ifo Investment Survey asks firms in the German manufacturing sector about the importance of sales, technological … factors, finance, return expectations, and macroeconomic policy for their investment activity in a given year. We show that … these subjective investment determinants 1) capture economically what their labels suggest, and 2) have strong explanatory …