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Investment, the cost of capital, and monetary policy in the nineties in France: a panel data investigation Author info | Abstract | Publisher info | Download info | Related research | Statistics Jean-Bernard Chatelain (University of Orleans - General, Rue de Blois, B.P. 6739, 45067 Orleans Cedex 2, France. )
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Using a large panel of 6,946 French manufacturing firms, this paper investigates the effect of monetary policy on investment from 1990 to 1999 through the cost-of-capital and the cash-flow channels. We compare several specifications to neo-classical demand for capital, taking into account transitory dynamics. The user cost of capital has a significant negative elasticity with respect to capital using traditional within estimates, or as long as cash-flow is not added to the regression when using Generalised Method of Moments estimates. Asymmetries of effect of monetary policy are evaluated for different groups of firms which differ in terms of informational asymmetries. When dummy variables related to firms which are more sensitive to cash-flow are added in the model, the user cost elasticity is significant again. JEL Classification: C23; D21; D92.
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Length: 51 pages
Date of creation: Dec 2001Date of revision:
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Keywords: Investment ; monetary policy ; generalised method of moments ; cost of capital. ; Other versions of this item:
Paper Chatelain, Jean-Bernard & AndrÈ Tiomo, 2002.
"Investment, the Cost of Capital, and Monetary Policy in the Nineties in France: A Panel Data Investigation ,"
Royal Economic Society Annual Conference 2002
45, Royal Economic Society.
[Downloadable!] Chatelain, J-B. & Tiomo, A., 2002.
"Investment, the Cost of Capital and Monetary Policy in the Nineties in France: A Panel Data Investigation ,"
Documents de Travail
96, Banque de France.
[Downloadable!] References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.: J. B. Chatelain & Andrea Generale & I. Hernando & U. von Kalckreuth & P. Vermeulen, 2001.
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Hall, B. & Mairesse, J. & Mulkay, B., 1998.
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Chirinko, Robert S. & Fazzari, Steven M. & Meyer, Andrew P., 1999.
"How responsive is business capital formation to its user cost?: An exploration with micro data ,"
Journal of Public Economics ,
Elsevier, vol. 74(1), pages 53-80, October.
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Jean-Bernard Chatelain & Andrea Generale & Ignacio Hernando & Philip Vermeulen & Ulf von Kalckreuth, 2001.
"Firm investment and monetary policy transmission in the Euro area ,"
Working Paper Series
112, European Central Bank.
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Other versions:
von Kalckreuth, Ulf & Hernando, Ignacio & Generale, Andrea & Chatelain, Jean Bernard & Vermeulen, Philip, 2001.
"Firm Investment and Monetary Policy Transmission in the Euro Area ,"
Discussion Paper Series 1: Economic Studies
2001,20, Deutsche Bundesbank, Research Centre.
[Downloadable!] Chatelain, J-B. & Generale, A. & Hernando, I. & Von Kalckreuth, U. & Vermeulen, P., 2002.
"Firm Investment and Monetary Policy Transmission in the Euro Area ,"
Documents de Travail
97, Banque de France.
[Downloadable!] Jean-Bernard Chatelain & Andrea Generale & Ignacio Hernando & Ulf Von Kalckreuth & Philip Vermeulen, 2003.
"Firm investment and monetary policy transmission in the Euro Area ,"
Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers)
halshs-00112525_v1, HAL.
[Downloadable!] Chatelain, Jean Bernard & Generale, Andrea & Hernando, Ignacio & Kalckreuth, Ulf von & Vermeulen, Philip, 2002.
"Firm Investment and Monetary Policy Transmission in the Euro Area ,"
10th International Conference on Panel Data, Berlin, July 5-6, 2002
A3-3, International Conferences on Panel Data.
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"Financial Factors In Business Fluctuations ,"
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Econometrica ,
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Other versions:
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references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
Jean-Bernard Chatelain & Andrea Generale & Ignacio Hernando & Philip Vermeulen & Ulf von Kalckreuth, 2001.
"Firm investment and monetary policy transmission in the Euro area ,"
Working Paper Series
112, European Central Bank.
[Downloadable!]
Other versions:
von Kalckreuth, Ulf & Hernando, Ignacio & Generale, Andrea & Chatelain, Jean Bernard & Vermeulen, Philip, 2001.
"Firm Investment and Monetary Policy Transmission in the Euro Area ,"
Discussion Paper Series 1: Economic Studies
2001,20, Deutsche Bundesbank, Research Centre.
[Downloadable!] Chatelain, J-B. & Generale, A. & Hernando, I. & Von Kalckreuth, U. & Vermeulen, P., 2002.
"Firm Investment and Monetary Policy Transmission in the Euro Area ,"
Documents de Travail
97, Banque de France.
[Downloadable!] Jean-Bernard Chatelain & Andrea Generale & Ignacio Hernando & Ulf Von Kalckreuth & Philip Vermeulen, 2003.
"Firm investment and monetary policy transmission in the Euro Area ,"
Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers)
halshs-00112525_v1, HAL.
[Downloadable!] Chatelain, Jean Bernard & Generale, Andrea & Hernando, Ignacio & Kalckreuth, Ulf von & Vermeulen, Philip, 2002.
"Firm Investment and Monetary Policy Transmission in the Euro Area ,"
10th International Conference on Panel Data, Berlin, July 5-6, 2002
A3-3, International Conferences on Panel Data.
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Paul Butzen & Catherine Fuss & Philip Vermeulen, 2001.
"The interest rate and credit channels in Belgium: an investigation with micro-level firm data ,"
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2001-12, National Bank of Belgium.
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Philip Vermeulen & Paul Butzen & Catherine Fuss & Patrick Sevestre & Andreas Worms, 2001.
"The interest rate and credit channels in Belgium: an investigation with micro-level firm data ,"
Working Paper Series
107, European Central Bank.
[Downloadable!] Butzen, Paul & Fuss, Catherine & Vermeulen, Philip, 2001.
"The interest rate and credit channels in Belgium: An investigation with micro-level firm data ,"
10th International Conference on Panel Data, Berlin, July 5-6, 2002
A3-1, International Conferences on Panel Data.
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"The Interest Rate and Credit Channels in Belgium: An Investigation with Micro-level Firm Data ,"
Brussels Economic Review/Cahiers Economiques de Bruxelles ,
Editions du DULBEA, Université libre de Bruxelles, Department of Applied Economics (DULBEA), vol. 45(3), pages 5-35.
Jean-Bernard Chatelain & Andrea Generale & Ignacio Hernando & Ulf Von Kalckreuth & Philip Vermeulen, 2003.
"Firm Investment And Monetary Policytransmission In The Euro Area ,"
Post-Print
halshs-00112525_v1, HAL.
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Gianni La Cava, 2005.
"Financial Constraints, the User Cost of Capital and Corporate Investment in Australia ,"
RBA Research Discussion Papers
rdp2005-12, Reserve Bank of Australia.
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Jean-Bernard Chatelain & Jean-Christophe Teurlai, 2004.
"The impact of the cost of capital and of the decision to invest or to divest on investment behaviour: an empirical investigation using a panel of French services firms ,"
Money Macro and Finance (MMF) Research Group Conference 2003
13, Money Macro and Finance Research Group.
[Downloadable!]
Jean-Bernard Chatelain & Andre Tiomo, 2002.
"Investment and the Cost of Capital in the Ninetiesin France: A Panel Data Investigation ,"
Post-Print
halshs-00112540_v1, HAL.
[Downloadable!]
Ignazio Angeloni & Benoit Mojon & Anil K. Kashyap & Daniele Terlizzese, 2002.
"Monetary transmission in the Euro Area: where do we stand? ,"
Working Paper Series
114, European Central Bank.
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Ignacio Hernando & André Tiomo, 2002.
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Banco de España Working Papers
0214, Banco de España.
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