The V-shaped value evolution of R&D projects
AbstractOn average the expected value at the moment of commercialization of an R&D project should remain constant during the different stages of new product development. Contrary to this intuition however, we find a systematic, non-constant pattern in the average expected value of an R&D project. First, the value declines after the initial screening, then rises after the first market analysis, but on average does not reach the initial level at the final stage of development when resources for market introduction are approved. Moreover, uncertainty about the project value declines over time. The findings suggest a V-shaped value function of R&D projects. Our study seems to be a first attempt to make direct measurements of valuing R&D projects through time in a real managerial setting.
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Bibliographic InfoPaper provided by Eindhoven Center for Innovation Studies (ECIS) in its series Eindhoven Center for Innovation Studies (ECIS) working paper series with number 00.05.
Date of creation: 2000
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R&D; R&D projects; expected value; new product development;
Other versions of this item:
- Onno Lint & Enrico Pennings, 2002. "The V-shaped value evolution of R&D-projects," Vlerick Leuven Gent Management School Working Paper Series 2002-5, Vlerick Leuven Gent Management School.
- NEP-ALL-2000-10-05 (All new papers)
- NEP-INO-2000-10-05 (Innovation)
- NEP-TID-2000-10-05 (Technology & Industrial Dynamics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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