Investment and Factor Demand

The first part of the book presents the estimation of traditional models of investment, their interpretation in the light of the disequilibrium theory and their use in evaluating the economic policies implemented during the seventies. The issue of the best representation of the production technology is also addressed. The second part analyses the interdependance of the decisions of investment, employment and consumption of raw materials using simultaneous estimations of factor demand equations, as well as the dynamic adjustment costs firms are facing. The last section illustrates the most recent theories and econometric methods: investment models with several regimes taking into account sales, employment and financing constraints, and the introduction of the uncertainty on future sales.