It is very important for firms who pursue profit maximization whether and when to carry on pollution abatement technology investment under tradable emissions permits and uncertainty. To consider an irreversible pollution abatement technology investment projects under a winner- takes-all patent system and the uncertainty takes two distinct forms: the technological success of the project is probabilistic, while the economic value to be won evolves stochastically over time. Considering these effects of uncertainty and using real options theory, it's to present a pollution abatement technology inv...
