Planted forests are long-term projects involving a large monetary contribution, and generally require the incorporation of managerial flexibility. As traditional methodology for economic evaluation does not allow these flexibilities, our study aimed to analyze whether investment in planted Pinus elliottii Engelm. economically feasible, by applying real options analysis. We used empirical data f...

The uninterrupted performance of the infrastructure systems a community is essential to its welfare and prosperity. Infrastructure assets are continuously subject degradation, which can compromise their increase seismic vulnerability. Measures such as retrofits should be adopted ensure assets. Proper timing these interventions reduce total costs incurred by communities. To this end, an appropri...

From the real options perspective the firm is conceived as a portfolio of real options. However, the theory of the firm traditionally argues into a similar direction by viewing the firm as either a set of institutions, as set of property rights or as a set of contracts. Due to this similarity, the question arises how far real options analysis can contribute to the theory of the firm and to an u...

The global shipping market has been depressed and turbulent since 2008. Shipping companies have had to be more cautious with their investments, so as buck the trend get through this difficult period. Traditional net present value methods cannot help enterprises make effective investment decisions. Therefore, we employ real options theory—including expansion options, contraction deferral abandon...

Abstract We consider an operator of machinery with deteriorating efficiency, facing the problem optimally timing either a minor (maintenance) investment or major (replacement) under price uncertainty. If maintenance is chosen, efficiency will deteriorate more slowly, and replacing later still possible. The optimal decision rule expressed in form thresholds for long-run prices, indicating that i...