A longstanding challenge in evaluating the impact of uncertainty on investment is obtaining measures of managers … the U.S. Census Bureau for approximately 25,000 manufacturing plants. We find three key results. First, investment is … associated with about a 6% reduction in investment. Second, uncertainty is also negatively related to employment growth and …

A longstanding challenge in evaluating the impact of uncertainty on investment is obtaining measures of managers … the U.S. Census Bureau for approximately 25,000 manufacturing plants. We find three key results. First, investment is … associated with about a 6% reduction in investment. Second, uncertainty is also negatively related to employment growth and …

rate of investment. This is proven for both the standard investment model with Cobb-Douglas production and Brownian motion … options and irreversibility, however, are shown to play an important role in the short run dynamics of investment and labor … demand. Specifically, they reduce the short run response of investment and hiring to current demand shocks, and lead to a …