This paper connects two branches of economics in a study of the price formation of industrial commodities. The first branch is the theory of irreversible investment under uncertainty, the second the theory of competitive speculation in stocks. A model which combines these two elements is...

We study the implications of microeconomic heterogeneity for aggregate technology, showing that the aggregate elasticity of substitution between capital and labor can be expressed as a simple function of plant level structural parameters and sufficient statistics for plant heterogeneity. This...