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Strategic learning and corporate investment

Décaire, Paul H.; Wittry, Michael D. - 2022

1800s that shapes the number of peers that a firm can learn from today. The strategic learning incentive is most salient …

Persistent link: https://www.econbiz.de/10012816427

Optimal Learning, Overvaluation and Overinvestment

Barbosa, António M.R.G. - 2019

optimal way to learn about the returns to scale. The optimal learning is also shown to produce overvaluation. The model is …

Persistent link: https://www.econbiz.de/10012858579

Investment Flexibility as a Barrier to Entry

Guthrie, Graeme A. - 2020

This paper presents a model of investment in a duopoly with firms that choose the scale and timing of investment. Decision-making flexibility and the costs saved by investing in large steps rather than sequences of small steps determine an incumbent's ability to deter entry by a potential...

Persistent link: https://www.econbiz.de/10012853973

Anti-Takeover Provisions and Investment Timing

Guthrie, Graeme - 2019

We show how directors can set the strength of a firm's anti-takeover provisions in order to influence the investment-timing decision of a future empire-building CEO. The prospect of future hostile takeover attempts, which terminate the CEO's control benefits if successful, affects the CEO's...

Persistent link: https://www.econbiz.de/10012892376

Investment Dynamics and Earnings-Return Properties : A Structural Approach

Breuer, Matthias - 2019

We propose the standard neoclassical model of investment under uncertainty with short‐run adjustment frictions as a benchmark for earnings‐return patterns absent accounting influences. We show that our proposed benchmark generates a wide range of earnings‐return patterns documented in...

Persistent link: https://www.econbiz.de/10012867279

Downward Wage Rigidity, Corporate Investment, and Firm Value

Cho, DuckKi - 2018

Firms reduce investment when facing downward wage rigidity (DWR), the inability or unwillingness to adjust wages downward. I construct DWR measures and exploit staggered state-level changes in minimum wage laws as an exogenous variation in DWR to document this fact. Following a one standard...

Persistent link: https://www.econbiz.de/10012935544

Investment Dynamics and Earnings-Return Properties : A Structural Approach

Breuer, Matthias - 2019

We propose the standard neoclassical model of investment under uncertainty with short-run adjustment frictions as a benchmark for earnings-return patterns absent accounting influences. We show that our proposed benchmark generates a wide range of earnings-return patterns documented in accounting...

Persistent link: https://www.econbiz.de/10012902450

Optimal Investment, Tobin's q, and Cash Flow : Does Unobserved Productivity Matter?

Kim, Kyoo il; Song, Suyong; Wang, Jiawei (Brooke) - 2021

Abstract We study the classical relationship between a firm’s investment and Tobin’s q for which unobserved productivity is another factor of a firm’s decision. Besides the potential measurement problem of Tobin’s q, controlling unobserved productivity is a new challenge. We develop an...

Persistent link: https://www.econbiz.de/10013218365

Time-to-Build and Capacity Expansion

Jeon, Haejun - 2021

the follow-up investment can be shorter than those of the initial project due to learning by doing. We derive the optimal … each project, however, is non-monotone with respect to the size of the lags. We can endogenize the degree of learning by … doing based on the proportion of capacity in each stage of the investment. Endogenous learning by doing is found to be non …

Persistent link: https://www.econbiz.de/10013242659

The Effects of Labor Choice on Investment and Output Dynamics

Jeon, Haejun; Cui, Xue; Zhang, Chuanqian - 2023

We incorporate both labor and capital as production inputs and discuss the effects of labor choice on a firm's optimal investment decision and output dynamics based on real options framework. In particular, we introduce different levels of labor flexibility and examine how it affects the firm's...

Persistent link: https://www.econbiz.de/10014254898