TY  - JOUR
AU  - Philippon,Thomas
AU  - Sannikov,Yuliy
TI  - Real Options in a Dynamic Agency Model, with Applications to Financial Development, IPOs, and Business Risk
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 13584
PY  - 2007
Y2  - November 2007
UR  - http://www.nber.org/papers/w13584
L1  - http://www.nber.org/papers/w13584.pdf
N1  - Author contact info:
Thomas Philippon
New York University
Stern School of Business
44 West 4th Street, Suite 9-190
New York, NY  10012-1126
Tel: 212/998-0490
Fax: 212/995-4233
E-Mail: tphilipp@stern.nyu.edu

Yuliy Sannikov
Department of Economics
208 Fisher Hall
Princeton University
Princeton, NJ 08544
E-Mail: sannikov@gmail.com
AB  - We study investment options in a dynamic agency model. Moral hazard creates an option to wait and agency conflicts affect the timing of investment. The model sheds light, theoretically and quantitatively, on the evolution of firms' dynamics, in particular the decline of the failure rate and the decrease in the age of IPOs.
ER  -