Real Options and Investment under Uncertainty
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Real Options and Investment under Uncertainty

Classical Readings and Recent Contributions

Edited by Eduardo S. Schwartz and Lenos Trigeorgis

Overview

Author(s)

Praise

Summary

The study of investment under uncertainty was stagnant for several decades, until recent developments in real options provided the tools to revitalize the field. The techniques and insights derived from option pricing can now be used to quantify the elusive elements of managerial operating flexibility and strategic interactions ignored or underestimated by conventional Net Present Value and other quantitative approaches.Topics covered include the reasons for the under-investment problem and conceptual frameworks for viewing productive investment opportunities as real options; useful valuation building blocks; the quantifying of various types of real options separately and in combination; strategic aspects of investment under uncertainty; numerical analysis techniques; a variety of applications, including the valuing of natural resources, R&D and pioneer ventures, land development, strategic acquisitions, government subsidies, power plants and pollution options, flexible manufacturing, and multinational operations; and empirical evidence from oil leasing, land prices, and discontinued operations.

Hardcover

Out of Print ISBN: 9780262194464 881 pp. | 9 in x 7 in

Paperback

$64.00 S ISBN: 9780262693189 881 pp. | 9 in x 7 in

Editors

Eduardo S. Schwartz

Eduardo S. Schwartz is the California Professor of Real Estate and Professor of Finance, Anderson Graduate School of Management, the University of California, Los Angeles.

Lenos Trigeorgis

Lenos Trigeorgis is the Bank of Cyprus Chair Professor of Finance in the School of Economics and Management at the University of Cyprus and Professor of Finance at King's College of the University of London. He is the author of Real Options (MIT Press), Strategic Investment, and other books.

Endorsements

  • A book of carefully chosen readings on real options is long overdue; the recognition that nearly every serious investment decision has important embedded options has spawned a growing and vibrant literature. Real Options and Investment Uncertainty will be an indispensable reference for both the practitioner who is looking for guidance and the academic who would like to know more about this new research area.

    Stephen Ross

    Franco Modigliani Professor of Finance and Economics, Massachusetts Institute of Technology

  • A book of carefully chosen readings on real options is long overdue; the recognition that nearly every serious investment decision has important embedded options has spawned a growing and vibrant literature. Real Options and Investment under Uncertainty will be an indispensable reference for both the practitioner who is looking for guidance and the academic who would like to know more about this new research area.

    Stephen Ross

    Franco Modigliani Professor of Finance and Economics, MIT