EconPapers    
Economics at your fingertips  
 

Discounting: Investment Sensitivity and Aggregate Implications

Jonathan Willis and Russell Cooper

No 607, 2015 Meeting Papers from Society for Economic Dynamics

Abstract: This paper studies the effects of discounting on plant-level and aggregate investment. We study a number of date based processes to represent the state dependent discount factor. Empirically, the stochastic discount factor is procyclical. The investment decision at the plant level is sensitive to the specification of the stochastic discount factor. Non-convexities in adjustment costs at the plant level have aggregate implications: lumpy investment is not smoothed.

Date: 2015
New Economics Papers: this item is included in nep-mac
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://red-files-public.s3.amazonaws.com/meetpapers/2015/paper_607.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:red:sed015:607

Access Statistics for this paper

More papers in 2015 Meeting Papers from Society for Economic Dynamics Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann (chuichuiche@gmail.com).

 
Page updated 2024-12-28
Handle: RePEc:red:sed015:607