We analyze the optimal investment strategy of a firm that can complete a project either in one stage at a single freely chosen time point or in incremental steps at distinct time points. The presence of economies of scale gives rise to the following trade-off: lumpy investment has a lower total...

We consider how efficient markets adopt technologies that reduce dependence on volatile factors such as oil. We find a relationship between volatility and technology overlap: new technology entry rate exceeds old technology exit rate under sufficient uncertainty. From this follows that efficient...

We analyse information aggregation in a stopping game with uncertain pay-offs that are correlated across players. Players learn from their own private experiences as well as by observing the actions of other players. We give a full characterization of the symmetric mixed strategy equilibrium,...

We consider energy investment, when a choice has to be made between fossil fuel and biomass fired production technologies. A dynamic model is presented to illustrate the effect of the different degrees of input price uncertainty on the choice of technology and the timing of the investment. It is...

We consider equilibrium timing decisions in a model with a large number of players and informational externalities. The players have private information about a common payoff parameter that determines the optimal time to invest. They learn from each other in real time by observing past...

Energy costs are notoriously uncertain but what is the effect of this on energysaving investments? We find that real-option frictions imply a novel equilibrium response to increasing but uncertain energy costs: early investments are cautious but ultimately real-option frictions endogenously...

We study the returns to political office using data from Finnish parliamentary elections in 1970-2007 and municipal elections in 1996-2008. The discontinuity of electoral outcomes in individual candidate votes allows us to estimate the causal effect of being elected on subsequent income. Getting...

We study hiring in a labor market where worker ability can only be observed on-the-job, but quickly becomes public information after labor market entry. We show that firms in these markets have a socially inefficient incentive to hire low talented, experienced workers instead of more promising...

We investigate divisions within the citation network in economics using citation data between 1990 and 2010. We consider all partitions of top institutions into two equal-sized clusters, and pick the one that minimizes cross-cluster citations. The strongest division is much stronger than could...