|
|
|
|
Title: |
Uncertainty and Investment in Equilibrium |
| Author: |
Hahm, Sangmoon |
| Author
Affiliation: |
Korea Institute
of Finance |
| Source: |
International Economic Journal, Winter 1996, v. 10, no. 4, pp. 71-82 |
|
Publication Date: |
Winter 1996 |
|
Abstract: |
In this paper, I show that even without
the irreversibility of investment, increased output demand uncertainty
may decrease investment under perfect competition. Furthermore, output
demand uncertainty never affects investment if the industry faces a
perfectly inelastic labor supply schedule. I also show that neither the
structly convex adjustment costs not the irreversibility of investment
are needed for bounded investment. |
|
