This paper analyzes the impact of endogenous credit terms under capital market imperfections in a capacity investment … setting. We model a monopolist firm that decides on its technology choice (flexible versus dedicated) and capacity level under … demand uncertainty. Differing from the majority of the stochastic capacity investment literature, we assume that the firm is …

capacity and production costs to vary over time). We show that the unintuitive but optimal behavior of denying customers …

capacity. …

manufactured. The production volumes in the first stage are bounded by given capacity limits. We develop an accurate lower bound … facilities; (ii) the trade-off between capacity and inventory investments; and (iii) the trade-off between capacity investments …

hedge and suggest rules of thumb for strategic placement of safety capacity and inventory in networks: (1) Risk pooling … suggests rebalancing capacity toward inexpensive resources that serve lower-profit variance markets. This highlights the role … suggests rebalancing capacity toward substitutable flexible but away from shared capacity when markets differ in profitability …

-to-business (B2B) markets. Such options, on both capacity and output, play an important role in integrating long- and short …

on sales, profits, and capacity decisions, including the degree of capacity imbalance. We find that the benefit from … increased demand aggregation is closely linked to the degree of capacity imbalance: profit gains from delayed allocation tend to … be higher in systems in which the optimal capacity portfolio is highly unbalanced when the allocation decision is made …

This paper studies optimal pricing and capacity decisions for a service facility in an environment where users' delay … delay cost and capacity cost. We find necessary and sufficient conditions for the optimality of a pricing rule that charges … out service resources at their marginal capacity cost. We examine the issue of budgetary balance and find that net …

firms make three decisions: capacity investment, production (inventory) quantity, and price. Typically, investments are made … capacity decisions by deterministic reasoning if they have some price flexibility. Under price postponement, additional … that this also makes the optimal capacity decision more sensitive to uncertainty. We highlight the different impact of more …