We study how investors' preferences for robustness influence corporate investment, financing, and compensation … ambiguity aversion lowers Tobin's q; the average investment, and investment volatility. The entrepreneur values the project at …

consumption, portfolio allocation, financing, investment, and business exit decisions. The optimal capital structure is determined …

, consumption/savings, and portfolio selection. For a lump-sum investment payoff and an agent with a sufficiently strong … precautionary savings motive, an increase in volatility can accelerate investment, contrary to the standard real options analysis …. When the agent can trade the market portfolio to partially hedge against investment risk, the systematic volatility is …

how liquidity and risk management policies coordinate investment and executive compensation policies to efficiently retain …

The interest rate is a key determinant of firm investment. We integrate a widely used term structure model of interest … rates, CIR (Cox, Ingersoll, and Ross (1985)), with the q theory of investment (Hayashi (1982) and Abel and Eberly (1994 …)). We show that stochastic interest rates have significant effects on investment and firm value because capital is medium …

We develop a q theory of investment with endogenous leverage, payout, hedging, and risk-taking dynamics. The key … interest payments, and even taps external equity markets at a cost before exhausting its endogenous debt capacity. The firm … seeks to preserve its financial flexibility by prudently managing its leverage and investment. Paradoxically, it is the high …

In lieu of carbon taxes to address global warming, sustainable investment mandates are proposed to incentivize firms to … model generates several testable predictions. A cost-of- capital wedge between qualified and unqualified firms equals firm … mitigation divided by its Tobin's q. Given projections of global warming and cost of decarbonization technologies, we calculate …