Optimal entry timing

@article{Kolb2015OptimalET,
  title={Optimal entry timing},
  author={Aaron M. Kolb},
  journal={J. Econ. Theory},
  year={2015},
  volume={157},
  pages={973-1000}
}

Figures from this paper

Strategic Real Options
Abstract I study hidden investment in quality in a dynamic persuasion game. A seller, such as a project manager or startup company, controls an asset and wants to convince a potential buyer, such as
Dynamic Quality Signaling with Hidden Actions
TLDR
It is found that the unobservability of the action causes equilibrium effort to be too low and the seller to stop signaling too early, which can be applied to education where grades depend on students’ effort, which is endogenously related to their skills.
Essays in microeconomics: information and learning
This dissertation contributes to the understanding of dynamic games in frictional markets. Specifically, it focuses on how information and search frictions influence outcomes in areas such as
Shopping for Information: Consumer Learning with Optimal Pricing and Product Design
I study a monopolistic pricing problem in which the consumer performs product research to determine whether or not to purchase a good. The consumer receives a signal of quality via a Brownian motion
Learning from Manipulable Signals
TLDR
It is found that terminations/market crashes are often preceded by a spike in (expected) performance, and the model predicts that, due to endogenous signal manipulation, too much transparency can inhibit learning.
Fight or Flight: Endogenous Timing in Conflicts
Abstract We study a dynamic game in which players compete for a prize. In a waiting game with two-sided private information about strength levels, players choose fighting, fleeing, or waiting.
Job Insecurity
We examine the relationship between job security and productivity in a fixed wage worker­firm relationship facing match quality uncertainty. The worker’s action affects both learning and current
Showing Off or Laying Low? The Economics of Psych-Outs
We analyze the incentives for showing off, which we model as a costly signaling game, and study the consequences of norms against such behavior. Prior to competing in a contest, a newcomer can signal
Optimal Exit Policy with Uncertain Demand
Entrants often need to make considerable sunk investments with highly uncertain returns. The option to exit if returns are low reduces investment risks and stimulates innovation. We examine the
...
...

References

SHOWING 1-10 OF 23 REFERENCES
Waiting for News in the Market for Lemons
We study a dynamic setting in which stochastic information about the value of a privately-informed seller’s asset is gradually revealed to a market of buyers. We characterize the unique equilibrium
Entry With Private Information
Models of firms' location in new markets, and certain repeated games have the feature that players must make location decisions (either in geographical space or in product-characteristics space) in
Entry and Vertical Differentiation
TLDR
The (unique) Markov perfect equilibrium of the infinite horizon game is derived under the strong long run average payoff criterion and the qualitative features of the optimal entry strategy are shown to depend exclusively on the relative ranking of established and new products based on current beliefs.
Entry and Exit Decisions under Uncertainty
  • A. Dixit
  • Economics
    Journal of Political Economy
  • 1989
A firm's entry and exit decisions when the output price follows a random walk are examined. An idle firm and an active firm are viewed as assets that are call options on each other. The solution is a
Signaling Games and Stable Equilibria
Games in which one party conveys private information to a second through messages typically admit large numbers of sequential equilibria, as the second party may entertain a wealth of beliefs in
Equilibrium Selection in Signaling Games
The authors introduce a new solution concept, divine equilibrium, which refines the set of sequential equilibria in signaling games by requiring that off-the-equilibrium-path beliefs satisfy an
Whether and When? Probability and Timing of Incumbents' Entry into Emerging Industrial Subfields
Many people have helped with this paper. The author would like to acknowledge explicitly the assistance of Glenn Carroll, David Teece, and the ASQ editor and reviewers. Part of this research was
Competitive experimentation with private information: The survivor's curse
Repeated Games with Incomplete Information
During the height of the Cold War, between 1965 and 1968, Robert Aumann, Michael Maschler, and Richard Stearns collaborated on research on the dynamics of arms control negotiations that has since
Noisy signalling over time
Many signalling situations feature noisy observation of the sender’s effort and multiple opportunities to signal. Noise and time generate novel features: in some equilibria, the high-cost type exerts
...
...