(August 2026) - This paper studies how managers plan under uncertainty. In a new panel survey of German manufacturing firms, we observe both forecasts of sales growth and a quantitative measure of sub...

(August 2026) - This paper studies how managers plan under uncertainty. In a new panel survey of German manufacturing firms, we observe both forecasts of sales growth and a quantitative measure of sub...

Monetary policy moves aggregate investment, but the underlying drivers remain unclear. This column opens the black box with a German firm survey. A one percentage point fall in loan rates raises investment by about 7%. Yet many firms do not adjust, often because they have ample cash or are off the margin. Firms’ narratives and their responses to actual monetary policy shocks indicate that the borrowing-cost channel is first-order for policy.

Hi! I am Manuel Menkhoff, a PhD candidate in Economics at Ludwig-Maximilians-Universität (LMU) and ifo Institute in Munich. In winter 2023, I was a visiting Ph.D. student at Stanford University. Rese...