Strategic timing of commercial-scale tidal energy investment

The Timing and Scale of Investment Under Uncertainty

This paper studies optimal investment in sunk assets for a ̄rm facing uncertain future demand and costs. The investment problem is decomposed into decisions over scale and timing which are in°uenced by convex adjustment costs and the feasibility of delaying investment. The value of the resulting real option to delay behaves as expected in response to increases in demand and cost uncertainty but...

Strategic Investment in Networks

We examine how the presence of network effects influences investment decisions. Building a network requires significant upfront investment but benefits carry tremendous uncertainty. This creates an incentive to defer the commitment of irreversible investments. However, such investments may also create the opportunity to convince the consumers about the network’s size, establish a network standa...

Strategic Timing of Technological Innovation Investment under Asymmetric Duopoly: A Real Option and Game-theoretic Approach

In an asymmetric duopoly option game-theoretic framework, this paper investigates the firms’ strategic technological innovation investment under uncertainty. There exist three types of equilibria that can occur in the choice of the technological innovation investment strategies, namely the preemptive, sequential and simultaneous equilibrium. The occurrence of a particular type of equilibrium is...

Characteristics of Tidal Energy

The Strategic Timing Incentives of Commercial Radio Stations: An Empirical Analysis Using Multiple Equilibria

Commercial radio stations and advertisers may have conflicting interests about when commercial breaks should be played. This article estimates an incomplete information timing game to examine stations’ equilibrium timing incentives. It shows how identification can be aided by the existence of multiple equilibria when appropriate data are available. It finds that stations want to play their comm...