The study of the investment-cash flow (ICF) sensitivity constitutes one of the largest literatures in corporate finance, yet little is known about changes in the ICF relationship over time, and the literature has largely ignored how rising R&D investment and developments in equity markets have...

We study how firms engaged in both R&D and fixed investment manage liquidity and adjust real investment during the recent financial crisis. Among firms with positive R&D expenditures, cuts to fixed investment in the crisis are typically far more severe than cuts to R&D. These firms allocate cash...

Higher country taxes on noxious manufacturing emissions lead to substantial increases in firm R&D spending. The R&D response is driven entirely by the high-pollution firms most affected by emissions taxes. Pollution taxes increase the market value of R&D spending in polluting firms, even when...