Description:

The overall aim of this research project, which is carried out in cooperation with Tilburg University and funded by the German Science Foundation (DFG) and the Dutch Science Foundation (NWO) between 2013 and 2016, is to develop and exploit a dynamic framework of analysis that allows studying the optimal investment strategies of oligopolistic firms under consideration of the uncertainty about future changes in the market structure. The considered research questions are analyzed using (piecewise deterministic) differential games as well as real option models. A combination of analytical and numerical methods are employed to characterize optimal behavior respectively behavior in the Markov-perfect equilibria of the considered models.