firm investments, proxied by total, short- and long-term investment. The results remain robust when we control for the … shift their investment from long- to short-term investment, given their unaffected credit ratings after undesirable … sovereign rating events. Conversely, firms’ investment is unaltered by the sovereign upgrades. Our findings also confirm that …

Recent literature has shown that corporate indebtedness affects firm-level investment behavior but not necessarily … substitute depressed investment by their financially constrained competitors. The increase in investment, primarily driven by … equilibrium effects are unambiguously countercyclical because the increase in investment by unconstrained firms does not crowd out …

investor “rationality,” the relation must be “explained” by a risk (factor) model. The investment approach questions the … approximations of firm-level investment returns. The evidence that characteristics dominate covariances in horse races does not …” expected returns; the investment approach is no more and no less “causal” than the consumption approach in “explaining …

We build a model of investment and financing decisions to study the choice between bonds and bank loans in a firm …'s marginal financing decision and its effects on corporate investment. We show that firms with more growth options, higher … investment. We test these predictions using a sample of U.S. firms and present new evidence that supports our theory …

In this paper, we investigate the damage to real-sector investment spending and corporate financing activities … triggered by the failure of three major investment banks during the 2007-09 financial crisis. We find that firms characterized … by pre-crisis corporate investment banking relationships with troubled investment banks exhibit significantly lower post …

Cash holdings at the onset of a financial crisis are a key determinant of investment by SMEs not only during the crisis … persistent and growing investment gap. The amplification effect was present for SMEs with both volatile and stable cash holdings …