shock. Our estimated model uncovers a central role for investment in the transmission mechanism of monetary policy, as high … MPCs amplify the investment response in the data. This force also generates a procyclical response of consumption to … investment shocks, leading our model to infer a central role for these shocks as a source of business cycles. …

Is monetary policy less effective at stimulating investment during periods of elevated volatility (when all firms … elevated volatility leads to a decrease in extensive margin investment incentive so that nominal stimulus generates less … aggregate investment. To do this, I first document empirically that high volatility weakens firms' investment responses to …

need for money may affect capital formation, resulting in either too much or too little investment. Existing models of … money and capital however tend to overlook that both types of investment inefficiencies can be equilibrium outcomes … implies that both over- and under-investment can arise. We use our framework to study whether monetary policy can effectively …

This paper analyses the theoretical and policy implications of assuming firm-specific lumpy investment behaviour by … firms and compares such implications to those occurring when adopting different investment specifications in a new …-Keynesian framework. We develop numerical simulations of the lumpy investment model by Sveen and Weinke (2007) and of other five …

the macroeconomics of saving-investment imbalances …

firms' investment is funded using financial markets. I then construct a dynamic equilibrium model that matches these … of financial assets, directing funds towards investment opportunities, and charge an intermediation spread to cover their … investment volatility …

We study the effects of monetary-policy-induced changes in Tobin's q on corporate investment and capital structure. We … develop a theory of the mechanism, provide empirical evidence, evaluate the ability of the quantitative theory to match the … evidence, and quantify the relevance for monetary transmission to aggregate investment …

While investment in most sectors declines in response to a contractionary monetary policy shock, investment in the …

only in the case where there is no investment and the interest rate channel only originates in the savings decisions of … households. The paper derives the dynamic IS curve analytically in a model with investment, where the interest rate channel … originates both in the the savings decisions of households and the investment decisions of firms. This generalized dynamic IS …

We argue that secular change in both the production and composition of investment goods has weakened private investment … the production of investment goods amplify the response of consumption to monetary policy shocks by varying labor income … investment goods production has declined, (ii) the import share of investment goods has risen, and (iii) the composition of …