This paper examines how financial frictions and policy uncertainty jointly influence firms' investments in pollution abatement. Our data analyses suggest that financially constrained firms are less likely to invest in pollution abatement and are more likely to release toxic pollutants, with this...

We study how financial heterogeneity determines firm-level investment responses to monetary policy shocks. In Compustat, a significant amount of firms hold almost zero debt, and among the firms who hold debt, both the amount and the maturity of debt vary greatly. We refer to these financial...

Is monetary policy less effective at stimulating investment during periods of elevated volatility (when all firms experience an increase in the variance of their productivity shocks) than during normal times? In this paper, I argue that elevated volatility leads to a decrease in extensive margin...