Strategic technology switching under risk aversion and uncertainty

Strategic Technology Adoption under Technological Uncertainty

Duopolistic competition under risk aversion and uncertainty

A monopolist typically defers entry into an industry as both price uncertainty and the level of relative risk aversion increase. The former attribute may be present in most deregulated industries, while the latter may be relevant for reasons of market incompleteness or the presence of technical uncertainty. By contrast, it has been shown that the presence of a rival hastens entry under risk neu...

strategic technology adoption under technological uncertainty

Inequity Aversion, Risk Aversion and Strategic Uncertainty in Public Good Games∗

This paper analyzes which type of individuals’ characteristics drive behaviors in a public good game, depending on strategic uncertainty. The results of the laboratory experiment emphasize that advantageous inequity aversion has a significant effect on the contribution decision but beliefs on the others’ contribution and risk aversion are the characteristics that mainly lead the contribution de...

Optimal investment under operational flexibility, risk aversion, and uncertainty

Traditional real options analysis addresses the problem of investment under uncertainty assuming a risk-neutral decision maker and complete markets. In reality, however, decision makers are often risk averse and markets are incomplete. We confirm that risk aversion lowers the probability of investment and demonstrate how this effect can be mitigated by incorporating operational flexibility in t...