Strategic Acceleration and Delay: Evidence on Optimal Timing of R&D Investment

31 Pages Posted: 26 Apr 2007  

Chang Hoon Oh

Simon Fraser University (SFU) - Beedie School of Business

Date Written: April 24, 2007

Abstract

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.

Keywords: strategic acceleration, strategic delay, R&D, competition

JEL Classification: O32

Suggested Citation

Oh, Chang Hoon, Strategic Acceleration and Delay: Evidence on Optimal Timing of R&D Investment (April 24, 2007). Available at SSRN: https://ssrn.com/abstract=982764 or http://dx.doi.org/10.2139/ssrn.982764

Chang Hoon Oh (Contact Author)

Simon Fraser University (SFU) - Beedie School of Business ( email )

8888 University Drive
Burnaby, British Colombia V5A 1S6
Canada

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