Arbeitspapier
Uncertainty shocks, adjustment costs and firm beliefs: Evidence from a representative survey
This paper studies the dynamic effects of an uncertainty shock on firm expectations. We conduct a survey that confronts managers from a representative firm sample with a model-consistent uncertainty shock scenario. An exogenous increase in uncertainty significantly reduces managers' expected investment, employment and production in the short and mid run. We collect novel direct firm-level measures for different types of capital and labor adjustment costs. Adjustment costs vary strongly across sectors and types. They help explain firms' reactions to the shock, which provides evidence for the relevance of real-options channels. We compare the findings to DSGE and VAR results.
- Language
-
Englisch
- Bibliographic citation
-
Series: KOF Working Papers ; No. 496
- Classification
-
Wirtschaft
Survey Methods; Sampling Methods
Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
Expectations; Speculations
Investment; Capital; Intangible Capital; Capacity
Macroeconomics: Production
Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
- Subject
-
Uncertainty
Shock
Firms
Survey
Vignette
Expectations
Investment
Employment
Production
- Event
-
Geistige Schöpfung
- (who)
-
Dibiasi, Andreas
Mikosch, Heiner
Sarferaz, Samad
- Event
-
Veröffentlichung
- (who)
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ETH Zurich, KOF Swiss Economic Institute
- (where)
-
Zurich
- (when)
-
2021
- DOI
-
doi:10.3929/ethz-b-000512724
- Handle
- Last update
-
10.03.2025, 11:43 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Dibiasi, Andreas
- Mikosch, Heiner
- Sarferaz, Samad
- ETH Zurich, KOF Swiss Economic Institute
Time of origin
- 2021
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