Optimal R&D investment strategies under the threat of new technology entry

2007 ◽  
Vol 25 (1) ◽  
pp. 103-119 ◽  
Author(s):  
R. Lukach ◽  
P.M. Kort ◽  
J. Plasmans
Keyword(s):  
New Technology ◽  
Investment Strategies ◽  
D Investment

The characteristics of institutional R&D investment in the STEM field under policy streams over time

2021 ◽  
pp. 147821032098638
Author(s):  
Youngsik Hwang
Keyword(s):  
New Technologies ◽  
New Technology ◽  
Research Direction ◽  
Investment Strategies ◽  
Total Size ◽  
Academic Fields ◽  
Development Expenditure ◽  
The Government ◽  
D Investment ◽  
Over Time

The STEM field has contributed significantly to the development of society because its findings result in new technology, which gives people more efficient tools and methods for a better standard of living. Postsecondary institutions have trained STEM field graduates through advanced curricula and learning environments. Compared to other academic fields, STEM requires more monetary support for research from the institution or the government because STEM research often requires expensive equipment installation or the introduction of new technologies. This paper overviews institutional support for STEM education and research by the regime of recent U.S. governments and examines the characteristics of R&D (research and development) expenditure. The results indicate that the R&D expenditures of the STEM field show continuous support for the different type of institutions, regardless of governments over time. However, they have tried to diversify the R&D investment by the type of R&D field and institutional type. Even though the government has tried to increase the total size of R&D expenditure through various resources, they still need to consider the equity and diversity issues for even further R&D investment strategies. A further research direction would search for the detailed action and strategies to support the STEM field according to their types of support or expectation.

The relation between R&D accounting treatment and the risk of the firm: Evidence from the Italian market

2014 ◽  
pp. 33-54 ◽  
Author(s):  
Riccardo Cimini ◽  
Alessandro Gaetano ◽  
Alessandra Pagani
Keyword(s):  
Earnings Management ◽  
Fiscal Year ◽  
Investment Strategies ◽  
Capital Assets ◽  
Italian Market ◽  
D Investment ◽  
Firm Evidence

In this paper, we investigate the relation between the different accounting treatments of R&D expenditures and the risk of the entity in order to identify under which treatment insiders are more likely to carry out earnings management. By analysing the R&D investment strategies of a sample of 137 listed Italian entities that complied with the requirements of IAS 38 during fiscal year 2009, following Lantz and Sahut (2005), we calculate several indexes that show the preferences of insiders to account R&D expenditures as costs or capital assets, and we study the relation of such preferences with the risk of the entity, which we measure with the unlevered beta. We hypothesize that the entities, which considered the R&D investments as costs, are the riskiest ones due to the higher probability that insiders carried out earnings management. Our results confirm such hypothesis. This paper could have implications for academics and standard setters that could learn that behind accounting discretion, insiders could opportunistically behave against outsiders.

Investment Strategies for Sourcing a New Technology in the Presence of a Mature Technology

2021 ◽  
Author(s):  
Wei Zhang ◽  
Hsiao-Hui Lee
Keyword(s):  
Operations Management ◽  
New Technologies ◽  
New Technology ◽  
Investment Strategy ◽  
Profit Sharing ◽  
Development Effort ◽  
Investment Strategies ◽  
Cost Shifting ◽  
The One ◽  
The Cost

To stay competitive, high-technology manufacturers not only frequently source new technologies from their suppliers, but also financially support the development of these new technologies into component products or production tools. We consider a manufacturer that can either source a new but immature technology from a financially constrained supplier, or source a mature technology from an existing supplier if and only if the development of the new technology fails. To support the new technology, the manufacturer can choose to inject capital in the form of an equity or loan. The investment strategy not only affects the new supplier’s development effort and the probability of technical success (PTS), but also affects the existing supplier’s effort to improve the mature technology, which presents the manufacturer with a trade-off. Following the debt financing literature, we find that a loan contract is associated with a cost-shifting effect and often leads to a higher PTS. However, because the manufacturer not only maintains an investment but also a procurement relationship with the new supplier, we find a profit-sharing effect associated with an equity investment, which does not exist in the traditional equity issuance literature. In particular, we show that the profit-sharing effect can dominate the cost-shifting effect and lead to a higher PTS when the new supplier’s technological capability is sufficiently high. Nonetheless, we also show that the strategy that derives a higher PTS does not necessarily generate a higher payoff for the manufacturer. On the one hand, a loan can be preferred even when it leads to a lower PTS because the cost-shifting effect allows the manufacturer to offer a sufficiently low procurement payment while maintaining a sufficiently high PTS. On the other hand, when the existing supplier is very capable of reducing its costs, a loan can over-incentivize the new supplier to exert excessive effort and backfire. This paper was accepted by Charles Corbett, operations management.

scholarly journals The Spatial and Mechanism Difference in the Export Evolution of Product Space in Global Countries

2021 ◽  
Vol 13 (4) ◽  
pp. 2255
Author(s):  
Shan Li ◽  
Xun Li ◽  
Wei Lang ◽  
Haohui Chen ◽  
Xiaoguang Huang
Keyword(s):  
Developing Countries ◽  
Product Space ◽  
New Technology ◽  
Spillover Effects ◽  
Developed Countries ◽  
Global Scale ◽  
The Core ◽  
Evolution Characteristics ◽  
Chemical Products ◽  
D Investment

This study focuses on investigating the changing export patterns, evolution characteristics, and influencing trade mechanisms of countries on a global scale. Based on comprehensive customs data, our study found that core location and export types, including machinery and chemical products, both play positive roles in promoting countries’ economic development. Developed countries are more likely to be at the core of the product space and to export machinery and chemical products. Countries’ R&D investment can affect the export location and types regardless of their economy, while high education matters in developed countries, and FDI (Foreign Direct Investment) is critical in developing countries. It indicates that technological benefits created by human capital can promote the export economy. Nevertheless, developing countries are not able to release strong knowledge spillover effects through their education systems, and they are relying more on the introduction of foreign investment to bring new technology.

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