What is the impact of real estate prices on corporate investment? In the presence of financing frictions, firms use pledgeable assets as collateral to finance new projects. Through this collateral channel, shocks to the value of real estate can have a large impact on aggregate investment. Over...

Chaney, Sraer, and Thesmar (2012) suggests that “shocks to the value of real estate [collateral] can have a large impact on aggregate [corporate] investment.” My comment shows that their reported coefficient estimates are spurious. They explain variation in their normalizing denominators...

What is the impact of real estate prices on corporate investment? In the presence of financing frictions, firms use pledgeable assets as collateral to finance new projects. Through this collateral channel, shocks to the value of real estate can have a large impact on aggregate investment. Over...

This short note is a response to Welch (2020), who claims that our results in Chaney, Sraer and Thesmar (2012) are not robust. We show that none of his findings invalidate our results. Welch makes three major points. First, he correctly points out that our baseline specification uses a common...