Strategic Capacity Investment Under Uncertainty with Volume Flexibility
نویسندگان
چکیده
منابع مشابه
Strategic Capacity Investment Under Uncertainty
Contrary to most of the papers in the literature of investment under uncertainty we study models that not only capture the timing, but also the size of the investment. We consider a monopoly setting as well as a duopoly setting and compare the results with the standard models in which the firms do not have the capacity choice. Our main results are the following. First, for low uncertainty value...
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This paper studies the impact of competition on a firm’s choice of technology (product-flexible or product-dedicated) and capacity investment decisions. Specifically, we model two firms competing with each other in two markets characterized by price-dependent and uncertain demand. The firms make three decisions in the following sequence: choice of technology (technology game), capacity investme...
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This paper extends the theory of real options, which mainly considers the problem of timing of investment, by letting the firm choose also the quantity produced after the time of investment. Under the conditions of irreversible investment and uncertainty in future demand, the firm can adjust its output quantity at each point in time in the future. Our paper shows that changing the structure of ...
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Research contributions providing insights at the intersection of real options analysis and industrial organization have become numerous in the recent decade. In the present paper, we provide an overview aimed at categorizing and relating these research streams. We highlight managerial insights about the type of competitive reaction, the manner in which information is revealed, the nature of the...
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ژورنال
عنوان ژورنال: SSRN Electronic Journal
سال: 2017
ISSN: 1556-5068
DOI: 10.2139/ssrn.2942060