An Aspect of Indivisible Land Development with a Reservation Level of Revenue

10 Pages Posted: 6 Nov 2003

See all articles by Amitrajeet A. Batabyal

Amitrajeet A. Batabyal

Rochester Institute of Technology (RIT) - Department of Economics

Seung Jick Yoo

Korea Energy Economics Institute

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Abstract

Recently, Batabyal and Yoo (2003) have studied aspects of indivisible and divisible land development in a dynamic and stochastic framework. In this note, we complement the analysis in this paper by examining an aspect of the indivisible land development decision when a landowner has an exogenously given reservation level of revenue. In particular, we show that the magnitude of the first record (largest offer) that exceeds the landowner's reservation revenue is independent of the time at which this record is received by the landowner.

Keywords: Dynamic, Indivisible, Land Development, Reservation Value, Uncertainty

JEL Classification: Q24, R19, D81

Suggested Citation

Batabyal, Amitrajeet A. and Yoo, Seung Jick, An Aspect of Indivisible Land Development with a Reservation Level of Revenue. Available at SSRN: https://ssrn.com/abstract=461361 or http://dx.doi.org/10.2139/ssrn.461361

Amitrajeet A. Batabyal (Contact Author)

Rochester Institute of Technology (RIT) - Department of Economics ( email )

92 Lomb Memorial Drive
Rochester, NY 14623-5604
United States
585-475-2805 (Phone)
585-475-5777 (Fax)

HOME PAGE: http://people.rit.edu/aabgsh

Seung Jick Yoo

Korea Energy Economics Institute ( email )

665-1 Naeson2-dong
Euiwang-si
Kyunggi-Do 437-082
Korea

HOME PAGE: http://www.rit.edu/~aabgsh/

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