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A Note on the Welfare and Policy Implications of a Two-Period Real Option Game Under Imperfect Information

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  • Congcong Wang

    (School of Finance, Zhejiang University of Finance and Economics, Hangzhou 310012, China
    These authors contributed equally to this work.)

  • Yuhan Wang

    (School of Finance, Zhejiang University of Finance and Economics, Hangzhou 310012, China
    These authors contributed equally to this work.)

  • Shanshan Chen

    (School of Finance, Zhejiang University of Finance and Economics, Hangzhou 310012, China
    These authors contributed equally to this work.)

  • Shravan Luckraz

    (School of Economics and CeDeX China, University of Nottingham Ningbo China, Ningbo 315104, China
    These authors contributed equally to this work.)

  • Bruno Antonio Pansera

    (Department of Law, Economics and Human Sciences & Decisions_Lab, University Mediterranea of Reggio Calabria, Via dell’Universitá 25, I-89124 Reggio Calabria, Italy
    These authors contributed equally to this work.)

Abstract

We show that the discrete real option game model proposed in the recent literature can be extended to the case of imperfect information. As a result, the model can cover a wider range of applications. However, we also observe that the effectiveness of implementing the subsidy is affected by the imperfect informational structure.

Suggested Citation

  • Congcong Wang & Yuhan Wang & Shanshan Chen & Shravan Luckraz & Bruno Antonio Pansera, 2025. "A Note on the Welfare and Policy Implications of a Two-Period Real Option Game Under Imperfect Information," Games, MDPI, vol. 16(1), pages 1-7, February.
    • Handle: RePEc:gam:jgames:v:16:y:2025:i:1:p:7-:d:1582867
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    References listed on IDEAS

    as
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    2. Lambrecht, Bart & Perraudin, William, 2003. "Real options and preemption under incomplete information," Journal of Economic Dynamics and Control, Elsevier, vol. 27(4), pages 619-643, February.
    3. Grzegorz Pawlina & Peter M. Kort, 2006. "Real Options in an Asymmetric Duopoly: Who Benefits from Your Competitive Disadvantage?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 15(1), pages 1-35, March.
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