marginal social cost functions determine whether a price-based or quantity-based environmental regulation leads to higher … expected social welfare. We revisit the choice between price-based vs. quantity-based environmental regulation under Knightian … uncertainty; that is, when uncertainty cannot be modeled with known probability distributions. Under these circumstances, the …

When a monopolist has discretion over the timing of infrastructure investments, regulation of post-investment prices … interferes with incentivizing socially optimal investment timing. In a model of regulated lumpy investment under uncertainty, we … study regulation when the regulator can condition price caps on investment timing. We analyse optimal regulation when there …

under uncertainty. The paper focuses on the heterogeneity of firm level investment responses to both demand and supply side … sources of uncertainty. Accordingly, the investment-uncertainty relationship is examined across groups of firms with varying … degrees of investment irreversibility defined on the basis of market structures and access to secondary markets for capital …

The socioeconomic impact of pollution naturally comes with uncertainty due to, e.g., current new technological … scenario will be realised and the scientific debate is still open. This paper captures those two layers of uncertainty by …

This paper examines the effects of uncertainty and flexible labour contracts on the Research and Development (R …&D outlays. Moreover, as predicted by the real options theory, our results suggest that product market uncertainty reduces R …&D efforts and that flexible labour contracts countervail the adverse effect of uncertainty on R&D. …

cost of restoration and uncertainty about irreversibility. All of the results to this point are for models with just two … introduce relevant dynamic elements to the general problem of decisions under uncertainty. We analyze actions that may have … essential to establish the direction of the bias. We also use Epstein's framework to look at issues such as uncertainty about …

Following the real option literature, whether or not uncertainty shocks drive business cycles depends on the degree of … adjustment frictions. The more plants freeze and remain inactive in response to increased uncertainty, the stronger the adverse … in uncertainty reduces hiring, quits and job creation, while it raises layoffs and job destruction. Our finding suggests …

underlying uncertainty on equilibrium strategies. Two firms contemplate entering a new market where the demand follows a jump …