The DOI matches its Crossref record; 9 of the 9 references it cites were found in a registry or an index.
Explaining Investment Dynamics in U.S. Manufacturing: A Generalized (S, s) Approach
Open accessAbstract
In this paper we derive a model of aggregate investment that builds from the lumpy microeconomic behavior of firms facing stochastic fixed adjustment costs. Instead of the standard sharp (S,s) bands, firms' adjustment policies take the form of a probability of adjustment (adjustment hazard) that responds smoothly to changes in firms' capacity gap. The model has appealing aggregation properties, and yields nonlinear aggregate time series processes. The passivity of normal times is, occasionally, more than offset by the brisk response to large accumulated shocks. Using within and out-of-sample criteria, we find that the model performs substantially better than the standard linear models of investment for postwar sectoral U.S. manufacturing equipment and structures investment data.
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Cites
Dixit, R. K., & Pindyck, R. S. (1994) · doi:10.1515/9781400830176 · Cited by 9,029
Recursive Methods in Economic Dynamics
Stokey, N. L., Lucas, R. E., & Prescott, E. C. (1989) · Harvard University Press eBooks · doi:10.2307/j.ctvjnrt76 · Cited by 3,031
Testing Statistical Hypotheses
Lehmann, E. L. (1986) · Springer Texts in Statistics · doi:10.1007/978-1-4757-1923-9 · Cited by 1,873
Asset Pricing and Optimal Portfolio Choice in the Presence of Illiquid Durable Consumption Goods
Grossman, S. J., & Laroque, G. (1990) · Econometrica · doi:10.2307/2938333 · Cited by 516
Plant-Level Adjustment and Aggregate Investment Dynamics
Caballero, R. J., Engel, E. M. R. A., Haltiwanger, J. C., Woodford, M., & Hall, R. E. (1995) · Brookings Papers on Economic Activity · doi:10.2307/2534611 · Cited by 481
Self-citationIrreversibility and Aggregate Investment
Bertola, G., & Caballero, R. J. (1994) · The Review of Economic Studies · doi:10.2307/2297979 · Cited by 460
Self-citationKinked Adjustment Costs and Aggregate Dynamics
Bertola, G., & Caballero, R. J. (1990) · NBER Macroeconomics Annual · doi:10.1086/654143 · Cited by 225
Self-citationDurable Goods: An Explanation for Their Slow Adjustment
Caballero, R. J. (1991) · Journal of Political Economy · doi:10.1086/261879 · Cited by 155
Self-citationPermanent Income, Liquidity, and Adjustments of Automobile Stocks: Evidence from Panel Data
Lam, P.-S. (1991) · The Quarterly Journal of Economics · doi:10.2307/2937913 · Cited by 41
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Tax Policy and Heterogeneous Investment Behavior
Zwick, E., & Mahon, J. (2017) · American Economic Review · doi:10.1257/aer.20140855 · Cited by 572
Displaced Capital: A Study of Aerospace Plant Closings
Ramey, V. A., & Shapiro, M. D. (2001) · Journal of Political Economy · doi:10.1086/322828 · Cited by 451
Asset Pricing Implications of Nonconvex Adjustment Costs and Irreversibility of Investment
COOPER, I. (2006) · The Journal of Finance · doi:10.1111/j.1540-6261.2006.00832.x · Cited by 363
Haltiwanger, J. C. (1997) · Review · doi:10.20955/r.79.55-78 · Cited by 253
Metadata
- Authors
- Caballero, R. J., & Engel, E. M. R. A.
- Venue
- Econometrica
- Publisher
- The Econometric Society
- Published
- 1999-07
- Volume
- 67
- Issue
- 4
- Pages
- 783-826
- ISSN
- 0012-9682 (ISSN-L)
- 1468-0262
- OpenAlex
- W3023084384
- Cited by
- 499
- References
- 9
- FWCI
- 18.46
- Type
- journal article
- Language
- en
- Open access
- green
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- Caballero, R. J., & Engel, E. M. R. A. (1999). Explaining Investment Dynamics in U.S. Manufacturing: A Generalized (S, s) Approach. Econometrica. https://doi.org/10.1111/1468-0262.00053
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Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.
