Research Discussion Paper – RDP 2021-11 Smells Like Animal Spirits: The Effect of Corporate Sentiment on Investment

Contents

• Corporate Sentiment, Animal Spirits and Investment
• The Tobin's Q Model with Sentiment Shocks
• Company-level Information on Sentiment and Investment
• The Effect of Corporate Sentiment Shocks
• Robustness Tests and Extensions
• Policy Implications and Conclusions
• References
• Copyright and Disclaimer Notice

I would like to thank Amanda Martz, Laura Nowzohour, Matthew Read, John Simon and Callan Windsor and seminar participants at the Reserve Bank of Australia and Macquarie University for their helpful comments. I am especially indebted to Jessica Boyle, Vienna Lu and Kim Nguyen for their feedback and technical help in undertaking the text analysis. And I am forever indebted to Paula Drew for her patience, advice and editing over the past 20 years. The views expressed in this paper are those of the author and do not necessarily reflect the views of the Reserve Bank of Australia. The author is solely responsible for any errors.