, while the Q literature has used cash flow sensitivity analysis to test whether financing constraints hinder investment. This … banks continued to facilitate investment once non-bank financing options became available. Using the explicit bond issuing … criteria to solve the endogenous firm-sorting problem, I measure the investment-cash flow sensitivity of Japanese firms, and …

asset pricing implications of the firm entry condition to explain the equity price response to a financial shock. The model … endogenous capital restructuring. Also, allowing the number of firms to fall after an adverse financial shock is a useful margin … of macroeconomic adjustment, reducing the overall impact of the shock on aggregate output. This is because the remaining …

This paper examines the importance of financial constraints for firm investment expenditures by looking at the … relationship between investment expenditures and proceeds from voluntary asset sales in financially healthy US manufacturing … companies. Specifically, we examine whether asset sales have a greater influence on investment expenditures for firms that are …

We show that supply-side financial shocks have a large impact on firms' investment. We develop a new methodology to … of aggregate loan and investment fluctuations …

We document how a plant-specific shock to investment opportunities at one plant of a firm ("treated plant") spills over … to other plants of the same firm--but only if the firm is financially constrained. While the shock triggers an increase … in investment and employment at the treated plant, this increase is offset by a decrease at other plants of the same …

Kaplan and Zingales [1997] provide both theoretical arguments and empirical evidence that investment-cash flow …

We investigate how a combination of limited liability and preexisting debt distort firms' investment and equity payout … investment distortions, where high leverage firms tend to overinvest but low leverage firms tend to underinvest. Permitting …

companies. I test the joint hypothesis that 1) a decrease in cash/collateral decreases investment, holding fixed the … profitability of investment, and 2) the finance costs of different parts of the same corporation are interdependent. The results … support this joint hypothesis: oil companies significantly reduced their non-oil investment compared to the median industry …

measures of liquidity on the investment decisions of U. K. firms. These variables are introduced via an extension of the Q … model of investment which explicitly includes agency/financial distress costs. We discuss if the significance of cash flow …