Time to build is a very important factor in a real estate development venture. Delay in completion of a project not only affects the financing costs and the rental revenue but also it may, on a more strategic note, determine the success or failure of a project. A time to build option model...

We present a dynamic model of venture capital financing, described as a sequential in­vestment problem with uncertain outcome. Each venture has a critical, but unknown threshold beyond which it cannot progress. If the threshold is reached before the completion of the project, then the project...

Besides static efficiency properties, environmental policies should be evaluated in terms of their longer-run impacts on investment and technological change to reduce pollution and degradation of natural resources. Using a stochastic dynamic programming approach, this paper analyzes how...

We analyze sequential investment decisions in an innovative project that depend on the investor's information about the project failure risk and its potential final value. We consider the feedback effects between learning about the project parameters and the continuous adjustment of the...

We present a dynamic model of venture capital financing, described as a sequential investment problem with uncertain outcome. Each venture has a critical, but unknown threshold beyond which it cannot progress. If the threshold is reached before the completion of the project, then the project...

This paper discusses the model and solution approach adopted by Majd and Pindyck (1987. Time to build, option value, and investment decisions. Journal of Financial Economics 18, March: 7-27) and Dixit and Pindyck (1994. Investment under uncertainty. Princeton, NJ: Princeton University Press),...

In this paper we study the economic feasibility of constructing a 560 MW coal-fired power plant in Turkey, using real options theory [1]. We start from a short review of the Turkish electricity market as well as the literature on real options theory and power plant investment. We then...