, uncertainty reduces corporate investment and employment. Using a novel firm-level measure of cash flow uncertainty, we find … empirically that uncertainty has a strong negative impact on corporate employment and investment in both tangible and intangible …, investment in tangibles would increase by 1.54%, and investment in intangibles would increase by1.29%. Our findings are robust to …

The investment literature has long acknowledged the time- and frequency-varying dynamics of the relationship between … investment, Tobin's Q and cash flow. In this paper, we use continuous wavelet tools to estimate and assess the relationship … complementary sources of information for investment, the former being more important for firms' investment decisions in the medium …

larger drop in demand for external finance and their cost of external finance, implying higher investment-cash flow …

It is well documented that since at least the 1970s investment-cash flow (I-CF) sensitivity has been decreasing over … time to disappear almost completely by the late 2000s. Based on a neoclassical investment model with costly external …

We develop a model of investment with financial constraints and use it to investigate the relation between investment … between q and investment, relative to the frictionless benchmark. We present a calibrated version of the model, which, due to … this effect, generates realistic correlations between investment, q, and cash flow. -- Financial constraints ; investment …

monetary and other shocks. The theory predicts a positive effect of cash flow on investment, given fundamental determinants of … investment. I use an empirical method developed by Gilchrist and Himmelberg (1995, 1999), which has previously only been used to … its investment, controlling for any information in cash flow about investment opportunities. As predicted by the balance …

This paper examines the sensitivity of investment to cash flow using a panel of UK firms in manufacturing with a view … debt accumulation), we also investigate the extent to which investment becomes more sensitive to cash flow in periods of … pioneered by Romer and Romer. The results provide some support for the view that UK firms show greater investment sensitivity to …

We contribute to the financial constraints literature and the investment-cash flow sensitivity debate by defining a new …-level employment growth as a control for investment opportunities, we find that constrained firms display the highest investment …

We explore whether the sensitivity of firm-level investment to cash-flow, typically associated with an external … conditions have indeed played a significant role in corporate investment decisions over recent years, rendering financing …, with constrained firms being substantially more likely to condition their investment decisions on overall credit conditions …