We develop a real options model of R&D valuation that takes into account the uncertainty in the quality (or efficacy) of the research output, the time and cost to completion, and the market demand for the R&D output. The model is then applied to study the problem of pharmaceutical...

To control increasing pharmaceutical expenditures, Taiwan's National Health Insurance has implemented a series of drug reimbursement price reductions since 2000. This study examined changes in use and expenditures of oral antidiabetic medications following the price regulation in November 2006.

This paper produces endogenous equity market non-participation in an economy with uninsurable labor income risk and heterogeneous skill levels. Prudence and impatience generate stationary household wealth levels that depend on income. Skill, and therefore labor income, heterogeneity leads to...

We develop a real options model of R&D valuation, which takes into account the uncertainty in the quality of the research output, the time and cost to completion, and the market demand for the R&D output. The model is then applied to study the problem of pharmaceutical under-investment in R&D...

We price corporate debt from a structural model of ï¬rm default. We assume that the capital market brings about efficient ï¬rm default when the continuation value of the ï¬rm falls below the value it would have after bankruptcy restructuring. This characterization of default makes the...