With deregulation in the electric power industry, traditionalapproaches for minimizing production costs have become unfit forthe present competitive environment. Owners of generationassets must now consider price uncertainty in solving unitcommitment problems for scheduling and operating their...

It is well known that the profitability within the process industry is heavily dependent upon the degree of utilisation of the plants. Utilisation, in turn, is dependent upon the often very volatile market conditions for the commodity produced. <p> This paper examines the implications for capital...</p>

In consequence of changes in general conditions, a higher level of investments and disinvestments in agriculture can be expected. To date, however, there are no policy impact analyses on both investments and disinvestments in competitive agricultural markets in a dynamic-stochastic context. This...

The gross soybean processing margin (the gross return per bushel of soybeans processed) is the main decision variable that processors use in deciding when and if to make binding commitments to process soybeans on future dates. Understanding how processors choose processing margins for future...

This paper studies the aggregate implications of microeconomic investment irreversibility and idiosyncratic uncertainty in a simple growth model by highlighting real option effects. We endogenize the drift rate of real option by connecting it to the state of the economy. Thereby, we extend the...