Investments in Kazakhstani Dairy Farming: A Comparison of Classical Investment Theory and the Real Options Approach

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dc.creatorTubetov, Dulat
dc.creatorMusshoff, Oliver
dc.creatorKellner, Ulla
dc.date2017-04-01T18:24:17Z
dc.date.accessioned2026-07-09T07:22:10Z
dc.descriptionThis study analyzes the explanatory potential of the real options approach (ROA) regarding the reluctance of Kazakhstani farmers to invest in modern dairy farming. More precisely, it compares the valuation of the ROA with those of the classical investment criterion such as the net present value (NPV). A further objective is to analyze the sensitivity of investment triggers with respect to assumed stochastic processes. To do so, an option-pricing model, which combines the stochastic simulation and the parameterization of investment triggers, is suggested. The results reveal that the investment trigger given by the ROA is considerably higher than the one given by the NPV criterion. This verifies that the ROA has an explanatory potential for the reluctance of farmers to invest in modern dairy farming. In addition, it was found that the option-pricing results indicate a high sensitivity regarding different stochastic processes as well as risk attitudes.
dc.identifierOther:ISSN 0049-8599
dc.identifierdoi:10.22004/ag.econ.155480
dc.identifierhttps://ageconsearch.umn.edu/record/155480/files/4_Tubetov.pdf
dc.identifierhttp://ageconsearch.umn.edu/record/155480
dc.identifier.urihttp://hdl.handle.net/123456789/587520
dc.languageeng
dc.publisher
dc.sourcehttp://ageconsearch.umn.edu/record/155480
dc.titleInvestments in Kazakhstani Dairy Farming: A Comparison of Classical Investment Theory and the Real Options Approach
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