embodied technology, investment irreversibility, and variable capacity utilization. Low short-run capital …

investment-specific productivity. We document that in U.S. postwar quarterly data total factor productivity (TFP) and the … relative price of investment are cointegrated. We show theoretically that TFP and the relative price of investment are … cointegrated if and only if neutral and investment-specific productivity share a common stochastic trend. We econometrically …

We embed the microeconomic decisions associated with investment under uncertainty, capacity utilization, and machine … mean-preserving spread in the productivity of investment raises aggregate investment, productivity, and output. Increases … in uncertainty have important dynamic implications, causing sustained increases in investment and hours and a medium …

investment; the impact of uncertainty on investment occurs primarily through changes in credit spreads; and innovations in credit … spreads have a strong effect on investment, irrespective of the level of uncertainty. These findings raise a question … financial shocks. By influencing the effective supply of credit, both types of shocks exert a powerful effect on investment and …

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 …