Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/220018
Authors: 
Reiter, Michael
Sveen, Tommy
Weinke, Lutz
Year of Publication: 
2020
Series/Report no.: 
IHS Working Paper No. 16
Abstract: 
Standard (S,s) models of lumpy investment allow us to match many aspects of the micro data, but it is well known that the implied interest rate sensitivity of investment is unrealistically large. The monetary transmission mechanism is therefore a particularly clean experiment to assess the macroeconomic relevance of any investment theory. Our results show that lumpy investment can coexist with a realistic monetary transmission mechanism, but that we are nevertheless still a step away from a micro-founded theory of monetary policy.
Subjects: 
Lumpy Investment
Sticky Prices
JEL: 
E22
E31
E32
Creative Commons License: 
https://creativecommons.org/licenses/by/4.0/
Document Type: 
Working Paper

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