In this paper we study a continuous time, optimal stochastic investment problem under limited resources in a market … with N firms. The investment processes are subject to a time-dependent stochastic constraint. Rather than using a dynamic …)]. -- stochastic irreversible investment ; optimal stopping ; the Bank and El Karoui Representation Theorem ; base capacity ; Lagrange …

This Working Paper assesses the impact on investment of a reduction in corporate taxes and the impact on employment … (1967), we estimate an investment function, which depends on the user cost of capital, one of whose determinants is the … short and long-term effects on investment in machinery and equipment. While the user cost of capital declines 0.9 percent …

The macroeconomic implications of firms' lumpy investment behavior are subject to ongoing research. Lumpy investment … periods, thereby reducing the frequency of investment activities. Using a dynamic stochastic general equilibrium model with … compute firms' optimal decisions on investment, utilization and labor demand. Compared to the constant utilization model, the …

The lumpy nature of plant-level investment is generally not taken into account in the context of monetary theory (see …, e.g., Christiano et al. 2005 and Woodford 2005). We formulate a generalized (S,s) pricing and investment model which is … empirically more plausible along that dimension. Surprisingly, our main result shows that the presence of lumpy investment casts …

This paper proposes a theory for the gradual evolution of knowledge diffusion and growth over the very long run. A …

We study a continuous-time, finite horizon optimal stochastic reversible investment problem for a firm producing a … bounded variation process which represents the cumulative investment-disinvestment strategy. We associate to the … Volterra type. The optimal investment-disinvestment strategy is then shown to be a diff usion reflected at the two boundaries …

We document the empirical fact that asset prices in the consumption-goods and investment-goods sector behave almost …

explaining the consumption path after a Marginal Efficiency of Investment shock. We use an otherwise standard medium-scale New …