Social Learning and Parameter Uncertainty in Irreversible Investment----Evidence from Greenhouse Adoption in Northern China

This paper introduces social learning into irreversible investment theory through parameter uncertainty, and shows that social learning could reduce parameter uncertainty to facilitate irreversible investment technology adoption. The theoretic model is tested by using household level data from energy saving greenhouse adoption in northern China, and empirical evidences are consistent with the theory: social learning has significantly positive impacts on greenhouse adoption, while market volatility discourages the adoption.


Issue Date:
2008
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/6310
Total Pages:
56
JEL Codes:
O12; O31; C61; D83; G12
Series Statement:
Selected Paper
466289




 Record created 2017-04-01, last modified 2017-11-16

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