We propose a model that jointly determines the capital structure and investment decisions taking business cycle and … triggers of investment, disinvestment, and default, which depend on the state of the economy. The level of investment triggers … sensitivity also dffers depending on the reversibility of the investment. The optimal leverage ratio is countercyclical, and the …

We report laboratory experiments investigating the cyclicality of profit-enhancing investment in a competitive … environment. In our setting, optimal investment is counter-cyclical when investment costs fall following market downturns. However …, we do not observe counter-cyclical investment. Instead we see much less strategic behavior than our rational investment …

or R&D spending. We use the housing price component independent of firms' investment opportunity and credit supply shocks … existence of the collateral channel as housing price growth and firm investment exhibit a positive relationship. This collateral … notable finding is that despite the collateral channel, large housing price booms are detrimental to investment, which …

Firm-level investment paths are commonly characterised by periods of low or zero investment punctuated by large … investment ‘spikes’. We document that such spikes are important for understanding firm and aggregate level investment in the UK …. We show that annual variation in aggregate investment is driven by variation in the number of firms undertaking investment …