Structural analysis of optimal investment for firms with non-concave revenue
AbstractQualitative properties of optimal investment strategies for a firm with quadratic costs and non-concave revenues are analysed. Organising information in a bifurcation diagram, it is found that the organising centre of the diagram is a so-called swallow-tail singularity. This implies the existence of threshold (or Skiba) points for positive discount factors. The parameter region for which threshold points exist is determined numerically, and for small discount factors some of its properties are derived by an approximation method.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Behavior & Organization.
Volume (Year): 57 (2005)
Issue (Month): 4 (August)
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Other versions of this item:
- Florian Wagener, 2004. "Structural analysis of optimal investment for firms with non-concave revenues," Computing in Economics and Finance 2004 187, Society for Computational Economics.
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
- C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
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