Valuation for the strategic management of research and development projects: The deferral option

EMJ - Engineering Management Journal

Volumn 16, Issue 4, 2004, Pages 36-48

  Lewis, Neal ^a   Enke, David ^b   Spurlock, David ^b  

^a MARSHALL UNIVERSITY   (United States)

^b MISSOURI UNIVERSITY OF SCIENCE AND TECHNOLOGY   (United States)

Author keywords

Deferral option; Net present value; Project valuation; Real options; Research and development

Indexed keywords

COMPUTER SIMULATION; EVALUATION; MANAGERS; RESEARCH AND DEVELOPMENT MANAGEMENT; SENSITIVITY ANALYSIS;

DEFERRAL OPTION; NET PRESENT VALUE; PROJECT VALUATION; REAL OPTIONS;

PROJECT MANAGEMENT;

EID: 15044340111     PISSN: 10429247     EISSN: None     Source Type: Journal    
DOI: 10.1080/10429247.2004.11415264     Document Type: Article

References (24)

1. Bellalah, Mondher, (2001) "Irreversibility, Sunk Costs and Investment Under Incomplete Information," RandD Management, 32(2), pp. 115-126.
2. Black, Fischer, and Myron Scholes, (1973) "The Pricing of Options and Corporate Liabilities," Journal of Political Economy, 81(3), pp. 637-654.
3. Bodie, Zvi, Alex Kane, and Alan J. Marcus, (2002) Investments, 5th ed., McGraw-Hill Irwin.
4. Boer, F. Peter, The Valuation of Technology, John Wiley and Sons, Inc. (1999).
5. Borissiouk, Olena, and Janos Pell, (2001) "Real Option Approach to RandD Project Valuation: Case Study at Serono International S.A.," Financier, 8:1-4, pp. 7-71.
6. Cobb, Barry R., and John M. Charnes, (2004) "Real Options Volatility Estimation With Correlated Inputs," The Engineering Economist, 49(2), pp. 119-137.
7. Copeland, Tom, and Vladimir Antikarov, (2001) Real Options: A Practitioner's Guide, Texere.
8. Davis, Julie L., and Suzanne S. Harrison, Edison in the Boardroom, John Wiley and Sons, Inc. (2001).
9. Deacon, Chrostpher G., and Alex Faseruk, "An Examination of the Greeks (Greek Symbols) from the Black Scholes Option Pricing Model," Journal of Financial Management and Analysis, 3:1 (January-June 2000), pp. 50-58.
10. Dixit, Avinash K., and Robert S. Pindyck, (1994) Investment Under Uncertainty, Princeton University Press.
11. Eschenbach, Ted G., (2003) Engineering Economy, 2nd ed., Oxford University Press.
12. Evans, James R., and David L. Olson, (2002) Introduction to Simulation and Risk Analysis, 2nd ed., Prentice-Hall.
13. Gibson, Rajna, Option Valuation, McGraw-Hill, Inc. (1991).
14. Gray, Clifford F., and Erik W. Larson, (2003) Project Management, The Managerial Process, 2nd ed., McGraw-Hill Irwin.
15. Herath, Hemantha S.B., and Chan S. Park. (1999) "Economic Analysis of RandD Projects: An Options Approach," The Engineering Economist, 44(1), pp. 1-35.
16. Kellogg, David, and John M. Charnes, (2000) "Real Options Valuation for a Biotechnology Company," Financial Analysts Journal, 56(3), pp. 76-84.
17. Meredith, Jack R., and Samuel J. Mantel, Project Management; A Managerial Approach, 5th ed., John Wiley and Sons, Inc. (2003).
18. Miller, Luke T., and Chan S. Park, (2002) "Decision Making Under Uncertainty-Real Options to the Rescue?," The Engineering Economist, 47(2), pp. 105-150.
19. Mun, Johnathan, (2002) Real Options Analysis, John Wiley and Sons.
20. Nichols, Nancy A., "Scientific Management at Merck: An Interview with CFO Judy Lewent," Harvard Business Review, 72:1 (January-February 1994), pp. 88-99.
21. Park, Chan S., Contemporary Engineering Economics, 3rd Ed., Prentice-Hall Inc. (2002).
22. Smith, Gordon V., and Russell L. Parr, Valuation of Intellectual Property and Intangible Assets, 3rd ed., John Wiley and Sons, Inc. (2000).
23. Teach, Edward, "Will Real Options Take Root?" CFO (July 10, 2003), pp. 1-4.
24. Trigeorgis, Lenos, (1996) Real Options: Managerial Flexibility and Strategy in Resource Allocation, The MIT Press.