Proost, Stef; Van Der Loo, Saskia - 2008
, in a one mode world (say rail or road), what is the optimal capacity choice when faced with uncertain demand, long lead … times and congestion. Using a simple analytical model it is shown that when demand is inelastic, it is socially optimal to … invest more than if only the expected level of demand is taken into account. In this case it may be beneficial to over invest …