Finite Project Life and Uncertainty Effects on Investment

This paper revisits the important result of the real options approach to investment under uncertainty, which states that increased uncertainty raises the value of waiting and thus decelerates investment.Typically in this literature projects are assumed to be perpetual.However, in today.s economy .rms face a fast-changing technology environment, implying that investment projects are usually considered to have a .nite life.The present paper studies investment projects with .nite project life, and we .nd that, in contrast with the existing theory, investments may be accelerated by increased uncertainty.It is shown that this particularly happens when uncertainty is limited and project life is short.investment;uncertainty;finite project length

Essays on Competition, Corporate Financing and Investment: A stochastic Dynamic Approach.

This thesis contains four studies on economic and finance theory that analyze the effects of time, uncertainty and information on firms’ strategic and financial decisions. The first essay presents a game-theoretic model of dynamic signaling taking place in an evolving environment. The model is applied to study dynamic limit-pricing strategies under stochastic demand. The second essay analyzes the effects of short-term liquidity shocks and long-term solvency distress on corporate finance policies. The last two papers study corporate investment decisions under uncertainty. In one essay, investment project lifetime is shown to critically affect investment behavior. The last paper studies optimal divestment policies and the trade-off between the flexibility of partial divestment and the premium of full-firm sale.

Investment Timing and Incentive Costs

We analyze how the costs of smoothly adjusting capital, such as incentive costs, affect investment timing. In our model, the owner of a firm holds a real option to increase a lumpy form of capital and can also smoothly adjust an incremental form of capital. Increasing the cost of incremental capital can delay or accelerate investment in lumpy capital. Incentive costs due to moral hazard are a natural source of costs for the accumulation of incremental capital. When moral hazard is severe, delaying investment in lumpy capital is costly, and it is optimal to overinvest relative to the first-best case

Sulfur analysis of Bolu-Mengen lignite before and after microbiological treatment using reductive pyrolysis and gas chromatography/mass spectrometry

Atmospheric pressure-temperature programmed reduction coupled with on-line mass spectrometry (AP-TPR/MS) is used for the first time on microbiologically treated coal samples as a technique to monitor the degree of desulfurization of the various sulfur functionalities. The experimental procedure enables the identification of both organic and inorganic sulfur species present in the coal matrix. A better insight in the degradation of the coal matrix and the accompanying processes during the AP-TPR experiment is obtained by a quantitative differentiation of the sulfur. The determination of the sulfur balance for the reductive pyrolysis gives an overview of the side reactions and their relative contribution in the total process. The volatile sulfur species are unambiguously identified using AP-TPR off-line coupled with gas chromatography/mass spectrometry (GC/MS). In this way, fundamental mechanisms and reactions that occur during the reductive pyrolysis could be quantified, explaining the differences in AP-TPR recoveries. Therefore, this study gives a clearer view on the possibilities and limitations of AP-TPR as a technique to monitor sulfur functionalities in coal

Carbon materials from conventional/unconventional technologies for electrochemical energy storage devices

In the last years our society has shown a growing interest on the development of both new sources of clean energy and advanced devices able to store it. In this context supercapacitors (SCs) and hybrid systems have emerged to cover the power and energy demands. Most of these electrochemical devices use carbon materials as electrodes being the activated carbons (ACs) the most commonly ones. Nonetheless graphene (G) has emerged as a promising electrode either by itself or combined with ACs in composites. This work investigates the use of a low added value coal-derived liquid (anthracene oil, AO) for the production of pitch-like carbon precursors to synthesize suitable active electrode materials (ACs, G, AC/G) in SCs and hybrid systems. In addition to the well-known oxidative thermal polymerization of AO, a new alternative based on the use of microwave heating is presented as a promising clean route to obtain such carbon precursors resulting in energy saving, shortening time and specific nonthermal effects. The characteristics of the carbon materials obtained from both conventional/ unconventional technologies are compared mainly in terms of their specific surface area, surface chemistry and electrical conductivity which would allow the design of energy storage devices with an improved electrochemical performance