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The collateral channel: How real estate shocks affect corporate investment

Author(s): Chaney, T; Sraer, David; Thesmar, D

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dc.contributor.authorChaney, T-
dc.contributor.authorSraer, David-
dc.contributor.authorThesmar, D-
dc.identifier.citationChaney, T, Sraer, D, Thesmar, D. (2012). The collateral channel: How real estate shocks affect corporate investment. American Economic Review, 102 (6), 2381 - 2409. doi:10.1257/aer.102.6.2381en_US
dc.description.abstractWhat is the impact of real estate prices on corporate investment? In the presence of financing frictions, firms use pledgeable assets as collateral to finance new projects. Through this collateral channel, shocks to the value of real estate can have a large impact on aggregate investment. To compute the sensitivity of investment to collateral value, we use local variations in real estate prices as shocks to the collateral value of firms that own real estate. Over the 1993-2007 period, the representative US corporation invests $0.06 out of each $1 of collateral.en_US
dc.format.extent2381 - 2409en_US
dc.relation.ispartofAmerican Economic Reviewen_US
dc.rightsFinal published version. Article is made available in OAR by the publisher's permission or policy.en_US
dc.titleThe collateral channel: How real estate shocks affect corporate investmenten_US
dc.typeJournal Articleen_US

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