We propose a tax‐adjusted q model with physical and intangible assets and estimate the effect of bonus depreciation in the United States in the early 2000s. We find that investment responds moderately to tax incentives, but allowing for heterogeneity reveals that intangible‐intensive firms...

We propose a tax-adjusted q model with physical and intangible assets and estimate it with a self-collected comprehensive database of intangible assets. The presence of intangibles changes the accounting and economic measures of q. We show that when tax changes are temporary, the q model can be...

Rollover risk imposes market discipline on banks' risk-taking behavior but it can be socially costly. I present a two-sided model in which a bank simultaneously lends to a firm and borrows from the short-term funding market. When the bank is capital constrained, uncertainty in asset quality and...

We show that peer effects influence corporate investment decisions. Using a sample of China’s listed firms from 1999 to 2012, we show that a one standard deviation increase in peer firms’ investments is associated with a 4% increase in firm i’s investments. We further identify the...