Paper Info
Title
Non-cooperative investment in partnerships and their termination.
Abstract
This paper investigates how partners (firms or husband and wife) should invest into an uncertain stock that provides a common good, when to stop investments and when to end their partnership. The assumption of lumpy investments leads to a real option problem which is solved for the cooperative and non-cooperative solutions. Yet despite the analytical solution, numerical means are necessary to investigate economic consequences: strong incentives to free ride under competition even turning one of the options—to stop investment at high stock levels—into one of a negative value; in contrast, divorce remains a positively valued option.
Year
DOI
Venue
2009
10.1007/s10100-009-0107-1
CEJOR
Keywords
Field
DocType
Stochastics,Real option game,Marriage,Divorce,J120,L140,C610
Market economy,Economics,Incentive,Economic consequences,Microeconomics,Common good (economics),Wife,General partnership,Operations management
Journal
Volume
Issue
ISSN
17
4
1435-246X
Citations 
PageRank 
References 
0
0.34
0
Authors
1
Name
Order
Citations
PageRank
Franz Wirl1105.31