Purpose – The purpose of this paper to develop an empirical methodology for managing spatial basis risk in weather index insurance by studying the fundamental causes for differences in weather risk between distributed locations. Design/methodology/approach – The paper systematically compares...

This paper examines the relationship between uncertainty and investment decisions by food andnon-food firms. Using hysteresis and the real options paradigm, we review why uncertaintymight cause firms to delay investment. In particular, our model looks for a negative relationshipbetween capital...