investment data. This yields, as a byproduct, a consistent decon1position of gross investment into replacement and expansion … investment. As an illustration, the model is applied to U.S. Electrical Machinery data …

markets lead to outcomes (prices and investment) that are not first-best, it even fails to achieve the second-best optimum … given the constraint of time-invariant pricing. We then show that attempts to correct the level of investment through taxes … necessarily reduce capacity investment, and it is likely to harm customers that are already on RTP …

We examine the performance attributes of a merchant transmission investment framework that relies on market driven …' transmission investment to provide the infrastructure to support competitive wholesale markets for electricity. Under a stringent … set of assumptions, the merchant investment model has a remarkable set of attributes that appear to solve the natural …

than its static analog. We then test the theory using monthly production targets of the Big Three U.S. auto manufacturers …

and future demand is uncertain. Investment requires the full …consistent with value maximization when investment is irreversible …cost of exercising the investment option. We show that for …