We build a Conditional Real Options model VORC which allows for cashflows to be probabilistic and contingent on the average behavior of an external variable; and we apply our model to the crude oil market where the inflows on an investment project are contingent on the state of the base -the...

Traditional project valuation usually overlooks the important risk analysis process because it relies in the complete market assumption. In a complete market it will be possible to either find twin securities or elaborate a dynamic investment portfolio to replicate the project risk and payoff in...

The choice of an appropriate discount rate is of major importance in cost benefit analysis both, at the private and at the social levels. The theories that rationalize the NPV criterion also identify the appropriate rate. However, the question remains as to what should be done when the...

Human development, understood as a long-term synergism between technological, physiological and cultural improvements, is a decisive, long-term factor of economic growth. However, it is characterized by intergenerational traps that slow down economic growth. This characterization is useful to...

This paper aims to identify the major factors that lead to school abandonment in an urban surrounding, namely, the shantytowns of Fortaleza, northeast Brazil. We use an extensive survey addressing risk factors faced by the population in these neighborhoods, which covered both in-school and...

This paper evaluates the effects that the decentralization reforms implemented in Colombia during the early nineties had on the quality of public schools. Through panel data techniques at the school level we find that, in the Colombian context, political economy trade-offs such as low ability of...

This study analyzes the incidence of educational expenditure on the actual delivery of public education. The study employs a social planner and interest group model to test the determinants of public expenditure of education along with the production of education. The model is tested for Mexico...