Irreversibilidad e incertidumbre de las decisiones financieras en i&d
[Irreversibility and uncertainty of the financial investments on r&d]
AbstractThe traditional methods for the valuation of investments are based on the possibility of calculating discount cash flows. The present paper analyses the problem associated to investments on innovative products, which require an important demand of R&D. The mentioned investments present irreversibility, flexibility and uncertainty characteristics. Therefore, it is proposed the Real Options methodology. To carry it out, investigations processes and their relationship with the financial market are described, with the aim of dealing with the irreversibility and the possibilities of making flexible a project. Finally, the different valuation methods are reviewed, focusing on the Black & Scholes formula to consider the options to wait, abandon, expand and suspend. It is necessary to take into account that the mentioned criteria does not replace the traditional valuation methods (especially NPV), but it should be incorporated to them, to appropriately treat the current context.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 40970.
Date of creation: 30 Jun 2012
Date of revision:
Research and Development; Real Options; uncertainty; Black & Scholes;
Find related papers by JEL classification:
- D53 - Microeconomics - - General Equilibrium and Disequilibrium - - - Financial Markets
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
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- Longstaff, Francis A & Schwartz, Eduardo S, 2001. "Valuing American Options by Simulation: A Simple Least-Squares Approach," University of California at Los Angeles, Anderson Graduate School of Management qt43n1k4jb, Anderson Graduate School of Management, UCLA.
- Timothy Sturgeon & Johannes Van Biesebroeck & Gary Gereffi, 2008. "Value chains, networks and clusters: reframing the global automotive industry," Journal of Economic Geography, Oxford University Press, vol. 8(3), pages 297-321, May.
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