EIB Working Paper 2024/02 - The effect of uncertainty on investment

Using firm-level survey data combined with firm-level financial information, this working paper examines the impact of uncertainty on EU firms' investment and employment growth. The analysis shows that increased uncertainty significantly dampens investment and employment. Specifically, high uncertai...

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格式: Online
語言:英语
出版: European Investment Bank 2025
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collection Directory of Open Access Books
description Using firm-level survey data combined with firm-level financial information, this working paper examines the impact of uncertainty on EU firms' investment and employment growth. The analysis shows that increased uncertainty significantly dampens investment and employment. Specifically, high uncertainty is associated with a 1 percentage point drop in employment growth and a 3 percentage point decrease in investment rates. Firms that cite uncertainty as a major impediment also report lower growth rates. The study reveals that if uncertainty levels had remained at 2021 levels, investments in 2022 would have been higher by 1 percentage point of fixed assets, and employment growth would have increased by 0.7 percentage points. The research underscores the substantial influence of uncertainty on economic activity and suggests policy measures to mitigate its impact.
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institution Directory of Open Access Books
language eng
publishDate 2025
publishDateRange 2025
publishDateSort 2025
publisher European Investment Bank
publisherStr European Investment Bank
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spelling doab-20.500.12854ir-1581072025-07-30T09:00:09Z EIB Working Paper 2024/02 - The effect of uncertainty on investment thema EDItEUR::K Economics, Finance, Business and Management::KF Finance and accounting thema EDItEUR::K Economics, Finance, Business and Management::KF Finance and accounting Using firm-level survey data combined with firm-level financial information, this working paper examines the impact of uncertainty on EU firms' investment and employment growth. The analysis shows that increased uncertainty significantly dampens investment and employment. Specifically, high uncertainty is associated with a 1 percentage point drop in employment growth and a 3 percentage point decrease in investment rates. Firms that cite uncertainty as a major impediment also report lower growth rates. The study reveals that if uncertainty levels had remained at 2021 levels, investments in 2022 would have been higher by 1 percentage point of fixed assets, and employment growth would have increased by 0.7 percentage points. The research underscores the substantial influence of uncertainty on economic activity and suggests policy measures to mitigate its impact. 2025-04-03T12:22:28Z 2025-04-03T12:22:28Z 2025-04-02T13:55:52Z 2024 book ONIX_20250402_9789286157554_8 https://library.oapen.org/handle/20.500.12657/100551 9789286157554 https://directory.doabooks.org/handle/20.500.12854/158107 eng open access image/jpeg n/a https://library.oapen.org/bitstream/20.500.12657/100551/1/9789286157554_pdf.pdf European Investment Bank 10.2867/723130 10.2867/723130 feca012f-a3d8-4aac-95aa-b6cf4bdbed7c 9789286157554 54 Luxembourg open access
spellingShingle thema EDItEUR::K Economics, Finance, Business and Management::KF Finance and accounting
thema EDItEUR::K Economics, Finance, Business and Management::KF Finance and accounting
EIB Working Paper 2024/02 - The effect of uncertainty on investment
title EIB Working Paper 2024/02 - The effect of uncertainty on investment
title_full EIB Working Paper 2024/02 - The effect of uncertainty on investment
title_fullStr EIB Working Paper 2024/02 - The effect of uncertainty on investment
title_full_unstemmed EIB Working Paper 2024/02 - The effect of uncertainty on investment
title_short EIB Working Paper 2024/02 - The effect of uncertainty on investment
title_sort eib working paper 2024 02 the effect of uncertainty on investment
topic thema EDItEUR::K Economics, Finance, Business and Management::KF Finance and accounting
thema EDItEUR::K Economics, Finance, Business and Management::KF Finance and accounting
topic_facet thema EDItEUR::K Economics, Finance, Business and Management::KF Finance and accounting
thema EDItEUR::K Economics, Finance, Business and Management::KF Finance and accounting
url ONIX_20250402_9789286157554_8