Investments as signals of outside options

DOI10.1016/J.JET.2013.12.001MaRDI QIDQ2439918zbMATH OpenOpenAlexWikidataFDO

Authors Susanne Goldlücke, Patrick W. Schmitz

Publication date 26 March 2014

Published in Journal of Economic Theory (Search for Journal in Brave)

Copyright license Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International

Full work available at URL https://doi.org/10.1016/j.jet.2013.12.001

zbMATH Keywords

hold-up problemincomplete contractsrelationship-specific investmentssignaling games

Mathematics Subject Classification ID

Portfolio theory (91G10) Signaling and communication in game theory (91A28) Economics of information (91B44) Financial applications of other theories (91G80)

Recommendations

• About the influence of optionality on a choice of investment decisions
• Rationalizing investors' choices
• Investment options and the business cycle
• Options, the Value of Capital, and Investment
• Real options and signaling in strategic investment games
• Ancora sulla scelta degli investimenti
• Investment under alternative return assumptions
• Optimal investment decisions
• Risk-incentives trade-off and outside options

Cites work

• Convex Analysis
• Countervailing incentives in agency problems
• On countervailing incentives
• Optimal Labour Contracts when Workers have a Variety of Privately Observed Reservation Wages
• Optimal litigation strategies with observable case preparation
• Participation constraints in adverse selection models
• The role of the agent's outside options in principal-agent relationships
• Unobservable Investment and the Hold-Up Problem

Cited in

(12)

• Noncontractible investments and reference points
• On the optimality of outsourcing when vertical integration can mitigate information asymmetries
• Investment in quality under asymmetric information with endogenously informed consumers
• Pre-trade private investments
• Completely relationship-specific investments, transaction costs, and the property rights theory
• \textit{Ex ante} investment, \textit{ex post} adaptation, and joint ownership
• Too much investment? A problem of endogenous outside options
• The role of the agent's outside options in principal-agent relationships
• Contractual signaling, relationship-specific investment and exclusive agreements
• Asymmetric information and the property rights approach to the theory of the firm
• Search equilibrium with unobservable investment
• The management of innovation: experimental evidence

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