This paper examines the link between real exchange rate volatility and domestic investment by using panel data … cointegration techniques. We study the empirical connection between real effective exchange rate volatility and investment for 51 … illustrate that real effective exchange rate volatility has a strong negative impact on investment. This outcome is robust in low …

We develop a model of investment, payout, and financing policies in which firms face uncertainty regarding their … between retention and payout, between internal or external financing of investment, and between speculation and hedging. In … the model, investment and payout do not always increase with slack for constrained firms and the choice between internal …