Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/152512
Authors: 
Mojon, Benoît
Smets, Frank
Vermeulen, Philip
Year of Publication: 
2001
Series/Report no.: 
ECB Working Paper 78
Abstract: 
This paper analyses the effects of a change in monetary policy on firms' investment in Germany, France, Italy and Spain using a data set which provides aggregated balance sheet and profit and loss account data for 17 different industries and 3 different size classes. The main findings are twofold. First, in each of the four countries a change in the user cost of capital, which in turn is affected by interest rates, has both statistically and economically significant effects on investment. Second, while the average interest rate on debt is generally higher for small firms than for large firms, there is little evidence that the effects of monetary policy on small firms are larger
JEL: 
E52
Document Type: 
Working Paper

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