STRATEGIC EXERCISE OF REAL OPTIONS：INVESTMENT DECISIONS IN TECHNOLOGICAL SYSTEMS

Viewing investment projects in new technologies as real options, this paper studies the effects ofendogenous competition and asymmetric information on the strategic exercise of real options. We firstdevelop a multi-period, game-theoretic model and show how competition leads to early exercise andaggressive investment behaviors and how competition erodes option values. We then relax the typicalfull-information assumption found in the literature and allow information asymmetry to exist acrossfirms. Our model shows, in contrast to the literature that payoff is independent of the ordering ofexercise, that the sequential exercise of real options may generate both informational and payoffexternalities. We also find some surpising but interesting results such as having more information isnot necessarily better.     

Modelling peak electricity demand

This paper estimates a forecasting equation for the hourly peak electricity demand one day in the future. The models incorporate deterministic influences such as holidays, stochastic influences such as average loads by building bivariate models, and exogenous influences such as the weather which is given a careful non-linear formulation. Out-of-sample comparisons are made using an additional year of data.     

Einstein,Nordström and the early demise of scalar,Lorentz-covariant theories of gravitation

Conclusion The advent of the general theory of relativity was so entirely the work of just one person — Albert Einstein — that we cannot but wonder how long it would have taken without him for the connection between gravitation and spacetime curvature to be discovered. What would have happened if there were no Einstein? Few doubt that a theory much like special relativity would have emerged one way or another from the researchers of Lorentz, Poincaré and others. But where would the problem of relativizing gravitation have led? The saga told here shows how even the most conservative approach to relativizing gravitation theory still did lead out of Minkowski spacetime to connect gravitation to a curved spacetime. Unfortunately we still cannot know if this conclusion would have been drawn rapidly without Einstein's contribution. For what led Nordström to the gravitational field dependence of lengths and times was a very Einsteinian insistence on just the right version of the equality of inertial and gravitational mass. Unceasingly in Nordström's ear was the persistent and uncompromising voice of Einstein himself demanding that Nordström see the most distant consequences of his own theory.     

The analysis of free-sorting data: Beyond pairwise cooccurrences

Free-sorting data are obtained when subjects are given a set of objects and are asked to divide them into subsets. Such data are usually reduced by counting for each pair of objects, how many subjects placed both of them into the same subset. The present study examines the utility of a group of additional statistics. the cooccurrences of sets of three objects. Because there are dependencies among the pair and triple cooccurrences, adjusted triple similarity statistics are developed. Multidimensional scaling and cluster analysis — which usually use pair similarities as their input data — can be modified to operate on three-way similarities to create representations of the set of objects. Such methods are applied to a set of empirical sorting data: Rosenberg and Kim's (1975) fifteen kinship terms.The author thanks Phipps Arabie, Lawrence Hubert, Lawrence Jones, Ed Shoben, and Stanley Wasserman for their considerable contributions to this paper.