Investment under Uncertainty
Author: Robert K. Dixit, Robert S. Pindyck
List Price: $70.00
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ISBN: 0691034109
Publisher: Princeton Univ Pr (10 January, 1994)
Sales Rank: 18,213
Average Customer Rating: 3.67 out of 5
Customer Reviews
Rating: 5 out of 5
A born classic book!
A lifetime book, a must for people interested in the modern "real options approach". Thorough and very didatic book, the maths level is far easier than Duffie's books, for instance. Requires differential calculus but at undergraduated engineering level. Previous knowledge of stochastic calculus and optimization under uncertainty are not required because there are two excellent chapters where the authors explain these tools in a concise format. For serious students, researchers and practitioners in capital budgeting, financial economics and investment theory. Comprehensive industrial applications models of practical importance, with several numerical results throughout charts and tables, makes this book valuable for capital budgeting consultants. In textbook format, for people interested in a deep understanding of the models, not only in rules of the thumb or ease advices. The best choice for graduated level courses, but some chapters also can be used for MBA courses, at least as complementary text. A born classic book!
Rating: 5 out of 5
State of the art -- but math is a required subject
Let me say that this is not a book for those looking for investment advice or get-rich-quick schemes. It is also not a book for those who think that an MBA and an HP12C are all you need to understand the basic theory behind investments, options, etc. It is a mathematical subject...and to those with a good mathematical background, the book is remarkably well-organized and easy to understand. I found this book to be very helpful in my research.
Rating: 2 out of 5
Not For The Faint-Hearted
Investment Under Undertainty by Avinash Dixit and Robert Pindyck has been an important book in the 1990's because it introduced a relatively new subject to a new and eager audience when there was little else available outside of original research papers. Many of us are grateful to the authors for this introduction. However, newcomers should be aware that they omit large and crucial details of implementation [example: chapter 4, section 1H, pages 110-112 including the graphs on page 111: a newcomer will be lost; if you wait until the appendix to chapter 10, on numerical solution, then you may or may not note the printing errors]. The book is not for the faint-hearted beginner; even the simplest material, such as valuation of a perpetuity (see Corporate Finance by Brealey & Myers - very easy) occurs in a form which the beginner or skim-reading manager might not readily recognise (chapter 5, secion 1A, pages 138-139); but then this book is not for them. See also Real Options by Lenos Trigeorgis, who writes as if he keenly wants you to have fast access to his subject. For someone writing purely on the mathematical finance aspects, read anything by Paul Wilmott, who is clearly both clever and an exceptional educator
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