Peer-Reviewed Journal Details
Mandatory Fields
Dewit G.;Leahy D.
2006
January
Journal of Economics and Business
Investment timing under uncertainty in oligopoly: Symmetry or leadership?
Published
()
Optional Fields
Flexibility Strategic commitment Uncertainty
58
1
1
19
This paper examines firms' investment-timing decisions in an oligopolistic set-up. Facing demand uncertainty, firms decide whether to invest early or wait until uncertainty has been resolved. We show that the precise form that investment commitment takes matters for the investment-timing outcomes that emerge. When firms can commit immediately to the final investment level, investment leadership may occur and early investment is referred to as being primarily "aggressive". By contrast, the presence of a time lag between when and how much firms invest yields symmetric investment-timing outcomes only; we argue that early investment is mainly "defensive" in that case. © 2006 Elsevier Inc. All rights reserved.
0148-6195
10.1016/j.jeconbus.2005.05.003
Grant Details