Excerpt from Liquidity Preference Under Uncertainty: A Model of Dynamic Investment in Illiquid Assets, November 1978 The paper presents a mathematical model of optimal investment in illiquid assets. Specifically, the model addresses the problem of an investor with limited capital resources, who makes sequential decisions on long-term investments under uncertainty as to future opportunities. The model demonstrates that such an investor will optimally demand a higher rate of return on investments in long-term, unmarketable assets and that the size of the premium demanded is an increasing function of the duration of the illiquid investment. About the Publisher Forgotten Books publishes hundreds of thousands of rare and classic books. Find more at www.forgottenbooks.com This book is a reproduction of an important historical work. Forgotten Books uses state-of-the-art technology to digitally reconstruct the work, preserving the original format whilst repairing imperfections present in the aged copy.

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