We document that 20% of Compustat firms have above-median investment rates despite having below-median marginal product of capital (MPK), seemingly "misallocating" productive resources. These firms are typically younger and significantly more likely to experience a substantial upward jump in...

In this paper, we analyze the effect of financial uncertainty on corporate investment using firm-level panel data from the Republic of Korea. We find that financial uncertainty has a significant negative effect on corporate investment, and that the effect is heterogeneous across firms of...

In this study, we analyse the effect of financial uncertainty on corporate investment using firm-level panel data from the Republic of Korea. We find that financial uncertainty has a significant negative effect on corporate investment, and that the effect is heterogeneous across firms of...

What determines investment is a much analysed policy question all around the world. Growth and previous investments are the primary variable used to analyse current investment. But there is much difference in opinions among economists regarding which policy instrument should be emphasised more...

A deep-ingrained doctrine in asset pricing says that if an empirical characteristic-return relation is consistent with investor “rationality,” the relation must be “explained” by a risk (factor) model. The investment approach questions the doctrine. Factors formed on characteristics are...

This case study explores and engages the strategic importance of china Pakistan economic corridor having based on $46 billion investment. The project is expected to bring about flood of opportunities not only for the two main players but other nations which are found to be interested in making...

What drives a firm's investment decisions in China? While most literature focuses on the role of financial factors (such as cash flow), we explore this most important question in corporate finance from the perspective of economic fundamentals. Empirical results show that private firms cherish...

This study investigates whether economic policy uncertainty (EPU) magnifies peer effects in corporate investment in China. Through use of the peer-firm-average idiosyncratic stock return to capture exogenous variation in peer firms' investment activities, we show that peer effects are stronger...

What drives a firm's investment decisions in China? While most literature focuses on the role of financial factors (such as cash flow), we explore this most important question in corporate finance from the perspective of economic fundamentals. Empirical results show that private firms cherish...

We study the drivers of investment in Italy during the global financial crisis and the sovereign debt crisis. We focus on the effect of leverage while controlling for the role of other drivers: expected demand, profitability, access to credit and uncertainty. As firm-level leverage may be...