The Effects of the War on Ukraine on Global Corporate Investment

Dario Caldara, Matteo Iacoviello, Mike McHenry and Immo Schott
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Mike McHenry: https://www.federalreserve.gov/econres/mike-j-mchenry.htm

No 1432, International Finance Discussion Papers from Board of Governors of the Federal Reserve System (U.S.)

Abstract: We study the investment effects of the Russia-Ukraine war using a novel, text-based measure of firm-level exposure derived from earnings call transcripts. Combining this measure with financial statement data for over 6,500 firms across 50 countries, we show that exposure to the conflict led to sizable and persistent declines in corporate investment. Firms that discussed the war in early 2022 invested significantly less than otherwise similar firms. The results hold across multiple empirical strategies and highlight the role of geopolitical risk in shaping firm behavior during global crises.

Keywords: Business fluctuations and cycles; Economic uncertainty; Corporate finance and governance; Investment (search for similar items in EconPapers)
JEL-codes: C55 E22 E32 (search for similar items in EconPapers)
Pages: 34 p.
Date: 2026-03-03
New Economics Papers: this item is included in nep-cis and nep-ifn
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgif:102900

DOI: 10.17016/IFDP.2026.1432

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