A dynamic model featuring a stochastic technology frontier shows significant impact of technology adoption for asset prices. In equilibrium, firms operating with old capital are riskier because costly technology adoption restricts their flexibilities in upgrading to the latest technology, making...

This article: i) introduces three new decision models - MN Type-I Decision Model; MN Type-II Decision Model and MN Type-III Decision Model; ii) explains why Risk-Adjusted Indices (“RAIs”; a class of Governance-models) can cause systemic risk; iii) explains why Risk-Adjusted Indices,...