Effects of Economic Policy Uncertainty on Corporate Investment: Review of Literature and Evidence from Japan

Ryosuke Fujitani, Masazumi Hattori and Yukihiro Yasuda

Economic Review, 2022, vol. 73, issue 4, 289-305

Abstract: This study reviews recent research on economic policy uncertainty（EPU）, which has received increasing attention. In particular, we focus on studies that utilize an index of EPU. Then, we empirically examine the effects of EPU on the investment behaviors of Japanese firms. We find that Japanese firms invest less when EPU increases. Our findings suggest that Japanese managers are more cautious when making investment decisions in response to a rise in EPU in Japan.

JEL-codes: D25 G31 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:hit:ecorev:v:73:y:2022:i:4:p:289-305

DOI: 10.15057/74340

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