In many cases consumers cannot observe firms' investment in quality or safety, but have only beliefs on the average … quality of the industry. In addition, the outcome of the collective investment game of the firms may be stochastic since firms … how firms' overall level of investment in quality depends upon the parameters of the quality accumulation process, the …

In many cases consumers cannot observe firms’ investment in quality or safety, but have only beliefs on the average … quality of the industry. In addition, the outcome of the collective investment game of the firms may be stochastic since firms … how firms’ overall level of investment in quality depends upon the parameters of the quality accumulation process, the …

This paper statistically tests the option theory of irreversible investment under uncertainty. Using contingent claims … prevailing at the investment date. We then test whether capacity investment decisions made by Canadian copper mines are … investment. Our model explains both investment size and timing satisfactorily, from a statistical, and from an economic, point of …

-time real-options model of capacity investment. Our methodology allows the evaluation of investment options and exercise rules … industry investment occurs earlier than socially optimal and the first entrant takes more risk than socially optimal. While …, taking the form of postponed capacity investment, may occur in Markov Perfect Equilibrium. Volatility and the expected speed …

continuous-time real-options model of capacity investment. Our methodology allows the evaluation of investment options and … the first industry investment occurs earlier than socially optimal and the first entrant takes more risk than socially …, tacit collusion, taking the form of postponed capacity investment, may occur in Markov Perfect Equilibrium. Volatility and …

In many cases consumers cannot observe firms' investment in quality or safety, but have only beliefs on the average … quality of the industry. In addition, the outcome of the collective investment game of the firms may be stochastic since firms … show how firms' overall level of investment in quality depends upon the parameters of the quality accumulation process, the …

This paper statistically tests the option theory of irreversible investment under uncertainty. Using contingent claims … prevailing at the investment date. We then test whether capacity investment decisions made by Canadian copper mines are … investment. Our model explains both investment size and timing satisfactorily, from a statistical, and from an economic, point of …

In an overlapping generations economy, lenders fund risky investment projects of firms by drawing up loan contracts in … the presence of an informational asymmetry. An optimal contract entails the issue of only debt, only equity, or a mix of …