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

smoothing in the investment response to aggregate shocks. The remaining 40% is explained by general equilibrium forces. The … particular, booms feed into themselves. The longer an expansion, the larger the response of investment to an additional positive … shock. Conversely, a slowdown after a boom can lead to a long lasting investment slump, which is unresponsive to policy …

investment behavior. New theories, better econometric procedures, and more detailed panel data sets are behind this movement … general equilibrium aspects of the investment problem also has been significant. The concept of sunk costs is at the center of … modern theories. The implications of these costs for investment go well beyond the neoclassical response to the irreversible …

holds for the microeconomic response of some of the most important economic variables, such as investment, labor demand, and … actual response to shocks is less than half as fast as the estimated response. For investment, labor demand and prices, the …, even after aggregating investment across all establishments in U.S. manufacturing, the estimate of its speed of adjustment …