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Investment Under Uncertainty and Time-Inconsistent Preferences
Grenadier, Steven R. - 2006
The real options framework has been used extensively to analyze the timing of investment under uncertainty. While standard real options models assume that agents possess a constant rate of time preference, there is substantial evidence that agents are very impatient about choices in the...
Persistent link: https://www.econbiz.de/10012466627
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A Theory of Firm Characteristics and Stock Returns : The Role of Investment-Specific Shocks
Kogan, Leonid - 2012
the firm's exposure to IST shocks and risk premia. Our calibrated model replicates: i) the predictability of returns by … returns by aggregate investment and valuation ratios; and v) a downward sloping term structure of risk premia for dividend …
Persistent link: https://www.econbiz.de/10012460684
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Financial Policies and the Financial Crisis : How Important Was the Systemic Credit Contraction for Industrial Corporations?
Kahle, Kathleen M. - 2010
Although firm financial policies were affected by a credit contraction during the recent financial crisis, the impact of increased uncertainty and decreased growth opportunities was stronger than that of the credit contraction per se. From the start of the financial crisis (third quarter of...
Persistent link: https://www.econbiz.de/10012462347
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Uncertainty Business Cycles - Really?
Bachmann, Ruediger - 2011
Are fluctuations in firms' profitability risk a major cause of regular business cycles? We study this question within … such a model, surprise increases of risk lead to a wait-and-see policy for investment at the firm level and a decrease in … the size of firm-level risk fluctuations. We find that time-varying firm-level risk on its own is unlikely to be a major …
Persistent link: https://www.econbiz.de/10012461796
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Costs of Air Quality Regulation
Becker, Randy A. - 1999
This paper explores some costs associated with environmental regulation. We focus on regulation pertaining to ground-level ozone (O3) and its effects on two manufacturing industries -- industrial organic chemicals (SIC 2865-9) and miscellaneous plastic products (SIC 308). Both are major emitters...
Persistent link: https://www.econbiz.de/10012471476
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Stock Issues and Investment Policy When Firms Have Information That Investors Do Not Have
Myers, Stewart C. - 1982
This paper describes corporate investment and financing decisions when managers have inside information about the value of the firm's existing investment and growth opportunities, but cannot convey that information to investors. Capital markets are otherwise perfect and efficient. In these...
Persistent link: https://www.econbiz.de/10012478227
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Tax Reform and Corporate Investment : A Microeconometric Simulation Study
Salinger, Michael A. - 1981
reforms on the 30 Dow Jones companies. The estimates are all based on extensions of Tobin's "q Theory of Investment" to take … results here provide strong microeconometric support for the q theory of investment. The q theory approach provides a superior …
Persistent link: https://www.econbiz.de/10012478358
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Tax Policy and Lumpy Investment Behavior : Evidence from China's VAT Reform
Chen, Zhao - 2019
A universal fact of firm-level data is that investment is lumpy: firms either replace a considerable fraction of their existing capital (spike) or do not invest at all (inaction). This paper incorporates the lumpy nature of investment into the study of how tax policy affects investment behavior....
Persistent link: https://www.econbiz.de/10012480302
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Climate Change, Operating Flexibility and Corporate Investment Decisions
Lin, Chen - 2019
Extreme temperatures lead to large fluctuations in electricity demand and wholesale prices of electricity, which in turn affects the optimal production process for firms to use. Using a large international sample of planned power plant projects, we measure the way that electric utilities'...
Persistent link: https://www.econbiz.de/10012480384
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Monetary Easing, Leveraged Payouts and Lack of Investment
Acharya, Viral V. - 2019
This paper studies a model in which a low monetary policy rate lowers the cost of capital for entrepreneurs, potentially spurring productive investment. Low interest rates, however, also induce entrepreneurs to lever up so as to increase payouts to equity. Whereas such leveraged payouts...
Persistent link: https://www.econbiz.de/10012480414