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To Wait or Not to Wait: Swiss EU-Membership as an Investment under Uncertainty

Spirig, Beat and Weder, Rolf. (2004) To Wait or Not to Wait: Swiss EU-Membership as an Investment under Uncertainty. WWZ Discussion Papers, 2004 (10).

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Abstract

Why do some countries join the EU earlier than others, why do others wait? In order to answer this question we apply the theory of investment under uncertainty (Dixit and Pindyck, 1994) to the decision on EU-membership. We develop a simplified model of two periods to study how the value of waiting depends among other things on the degree of uncertainty. The results give rise to a country’s position to deliberately postpone a membership in order to keep the option to join later if this is desirable. After interpreting the results we apply the findings to the EU. We argue that the approach provides interesting insights regarding EU-membership, in general, and the Swiss position, in particular.
Faculties and Departments:06 Faculty of Business and Economics
06 Faculty of Business and Economics > Departement Wirtschaftswissenschaften
06 Faculty of Business and Economics > Departement Wirtschaftswissenschaften > Professuren Wirtschaftswissenschaften > Aussenwirtschaft und Europ. Integration (Weder)
12 Special Collections > WWZ Publications > WWZ Discussion Papers and Working Papers
UniBasel Contributors:Spirig, Beat and Weder, Rolf
Item Type:Working Paper
Publisher:WWZ, University of Basel
Note:Publication type according to Uni Basel Research Database: Discussion paper / Internet publication
Language:English
Identification Number:
  • handle: RePEc:bsl:wpaper:2004/10
Last Modified:09 Mar 2018 10:53
Deposited On:08 Mar 2018 09:02

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