Strategic Acceleration and Delay: Evidence on Optimal Timing of R&D Investment
Chang Hoon Oh
Simon Fraser University (SFU) - Beedie School of Business
April 24, 2007
This paper examines the relationships between market structure and the optimal timing of R&D investment by using firm-level data of the U.S. manufacturing industry. In addition, this paper analyzes the effects of firm resources, such as firm size, liquidity constraint, and R&D expenditure on the optimal timing of investment. The empirical results show that when the market is more competitive, it is optimal to delay the property investment of uncertain projects and to accelerate introduction of product into the market. However, a firm's debt to equity ratio is not significantly related to the firm's investment timing decision.
Number of Pages in PDF File: 31
Keywords: strategic acceleration, strategic delay, R&D, competition
JEL Classification: O32
Date posted: April 26, 2007
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