It is well known that consumers, when faced with limited choices or temporary stock-outs, will often chose different sizes, colors or brands rather than go home empty handed. Intuitively, a firm's decisions about the level of variety they offer and the quantity of inventory they stock ought to...

This paper introduces a Monte Carlo simulation method for pricing multidimensional American options. The method is based on the computation of the optimal exercise frontier. It is simple, efficient and flexible, suitable for multidimensional options. We consider options that can be exercised at...

We present new models and solution results that combine traditional yield management OR models with behavioral models of customer purchasing behavior. We study monopoly and oligopoly conditions of competition and also present new estimation procedures.

The sector of information technologies has been recently invoked to crucially matter in the recent trends and performances of national economies (see for example Gordon, 1999, and Greenwood and Jovanovic, 1999). In this paper, we propose a computable general equilibrium framework in which this...

This paper examines the impacts of endogenous credit constraints on labor supply, the accumulation of human capital, and consumption across agents that are heterogeneous in age, ability, and initial wealth. In our model, contrary to the standard human capital literature, credit constraints arise...

Agents' heterogeneity, arising from asymmetric information, heterogeneous beliefs, endowments or constraints, calls for theoretical approaches to economic systems that go beyond the so-called representative agent approach.In systems of many interacting agents, such as markets, a detailed...

The term structure of expected inflation is key to assessing the credibility of monetary policy, to examining how borrowing decisions of households and firms respond to shifts in real costs of debt, and to evaluating the expected inflation response to monetary policy actions. Unfortunately,...

This paper presents a multi-regional overlapping generations model built to study the effects mid to long run demographic dynamics on savings and international financial flows.The world is divided into six regions presenting contrasted demographical evolutions. In each region, the behavior of 15...

The dynamics of state variables of an economic system are described using stochastic differential equations. The system is observed in discrete points of time in order to get information about the status of the state variables. The gained information leads to decisions that are implemented in...