Strategic Investment Timing Under Profit Complementarities

This paper analyses strategic investment games between two firms that compete for the adoption of a new more efficient technology whose returns are uncertain. We assume that once one of the two firms adopted the new technology, joint adoption is preferable for both firms, that is there are profit complementarities in the product market. There are, moreover, externalities derivig from the first firm's investment. By modelling the switch from a well established technology to a new one as a dynamic stochastic game, we fully characterize the equilibria of the game under both non-cooperative and cooperative firms' behaviour. We show that in the cooperative equilibrium firms will invest later under negative externalities and earlier under positive externalities. Thus we identify circumstances in which competiton can be suboptimal (too much waiting). Overall, compared to earlier models that only allow for a new market game, our model examines a richer set of strategic interactions of adoption decisions

The AGILE Mission

AGILE is an Italian Space Agency mission dedicated to observing the gamma-ray Universe. The AGILE's very innovative instrumentation for the first time combines a gamma-ray imager (sensitive in the energy range 30 MeV-50 GeV), a hard X-ray imager (sensitive in the range 18-60 keV), a calorimeter (sensitive in the range 350 keV-100 MeV), and an anticoincidence system. AGILE was successfully launched on 2007 April 23 from the Indian base of Sriharikota and was inserted in an equatorial orbit with very low particle background. Aims. AGILE provides crucial data for the study of active galactic nuclei, gamma-ray bursts, pulsars, unidentified gamma-ray sources, galactic compact objects, supernova remnants, TeV sources, and fundamental physics by microsecond timing. Methods. An optimal sky angular positioning (reaching 0.1 degrees in gamma- rays and 1-2 arcmin in hard X-rays) and very large fields of view (2.5 sr and 1 sr, respectively) are obtained by the use of Silicon detectors integrated in a very compact instrument. Results. AGILE surveyed the gamma- ray sky and detected many Galactic and extragalactic sources during the first months of observations. Particular emphasis is given to multifrequency observation programs of extragalactic and galactic objects. Conclusions. AGILE is a successful high-energy gamma-ray mission that reached its nominal scientific performance. The AGILE Cycle-1 pointing program started on 2007 December 1, and is open to the international community through a Guest Observer Program

Dividends and equity prices: the variance trade off

This paper shows that standard corporate finance theory implies that there is potentially a trade off between the variances of dividends and equity prices. We show how the trade off works in a stochastic difference equation model of dividend policy demonstrating that the solution may be unstable for plausible parameter values. At the boundary of the feasible set of price and dividend variances, prices and dividends are perfectly correlated and both follow an AR(1) process. We calculate explicit formulae for the variances, and show that firms could in principle make prices completely predictable, by immediately incorporating all news about the present value of earnings into dividends. By choosing to smooth dividends firms increase the variance of prices, and may also increase the variance of dividends. We show how this can easily result in sample variances which violate variance bounds inequalities

Power Density Axial Oscillations Induced by Xenon Dynamics: Parameter Identification via Genetic Algorithms

none3M. MARSEGUERRA; E. ZIO; G. TORRIMarseguerra, Marzio; Zio, Enrico; Torri, Gianfranc

The effect of risky debt on R&D investment

This paper investigates the interaction between investment decisions, company bankruptcy, and capital structure. We model young and innovative enterprises which face the possibility of making irreversible investments in R&D with uncertain returns, financed through risky debt. Uncertainty comes from two different sources: the technological success of the project and the return from investment. In an optimal investment setting, where uncertainty creates an incentive to delay investment decisions, we find the optimal threshold of entry (invest) and exit (bankruptcy), investigating both the case of infinite and finite debt maturity We show that the potential loss of the investment option in the event of default, reduces the value of waiting and provides equity holders with an incentive to accelerate the investment. Thus the results of the model here presented seem to imply an active role for financial institutions but traditional loans may not be the most suitable solution to finance risky investment. In line with recent recommendations of the European Investment Bank (EIB, 2013), traditional bank lending might need to be reinforced through further instruments, such as loan guarantees and securitisation

La Computational Economics nella riflessione di Siro Lombardini

Siro Lombardini, uno dei massimi economisti italiani del XX secolo, introdusse nella pratica della scienza economica nuovi approcci metodologici, anche attraverso l'ispirazione che gli veniva dal coltivare, con attenzione e curiosit\ue0, altre discipline. Il saggio da' conto di uno di questi approcci, denominato computational economics