Yes, most likely. The firm-level evidence on costly reversibility is even stronger than the prior evidence at the plant …, and the fraction of negative investments. The combined effect of costly reversibility and operating leverage is the key …

contractions. Consistent with costly reversibility, high BM firms with more fixed assets are less profitable and dispose of more … fixed assets during contractions than low BM firms. Support for costly reversibility looking at k and MRP is found when … provided for costly reversibility, it is limited in explaining the value premium. …