TY  - BOOK
AU  - Caballero,Ricardo J.
AU  - Leahy,John V.
ED  - National Bureau of Economic Research.
TI  - Fixed Costs: The Demise of Marginal q 
T2  - NBER working paper series
PY  - 1996///
CY  - Cambridge, Mass.
PB  - National Bureau of Economic Research
N1  - March 1996; Hardcopy version available to institutional subscribers
N2  - The standard version of q theory, in which investment is positively related to marginal q, breaks down in the presence of fixed costs of adjustment.  With fixed costs, investment is a non-monotonic function of q.  Therefore its inverse, which is the traditional investment function, does not exist.  Depending upon auxiliary assumptions, the correlation between investment and marginal q can be either positive or negative.  Given certain homogeneity assumptions, a version of the theory based on average q still holds, although under the same assumptions profits and sales perform as well as average q. More generally, q is no longer a sufficient statistic
UR  - https://www.nber.org/papers/w5508
UR  - http://dx.doi.org/10.3386/w5508
ER  -