Uncertainty and flexibility in infrastructure investments: Application of real options analysis to the Ponta Delgada airport expansion

Ponta Delgada airport is the most important air transport infrastructure in the Autonomous Region of the Azores. The increase in airport activity that resulted from the partial liberalization of the air transport sector has increased the pressure on its capacity. This study used Smit (2003) framework to evaluate the Ponta Delgada airport expansion, taking into consideration the future growth opportunities that come from an increase in tourism...