Real Options and Project Evaluation

Project evaluation in the presence of multiple embedded real options: evidence from the Taiwan High-Speed Rail Project

Journal of Asian Economics ◽

10.1016/j.asieco.2003.12.001 ◽

2004 ◽

Vol 15 (1) ◽

pp. 71-98 ◽

Cited By ~ 39

Author(s):

Michael Bowe ◽

Ding Lun Lee

Keyword(s):

Real Options ◽

High Speed ◽

Project Evaluation ◽

High Speed Rail

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Real options valuation: the new frontier in R&D project evaluation?

R and D Management ◽

10.1111/1467-9310.00135 ◽

1999 ◽

Vol 29 (3) ◽

pp. 255-270 ◽

Cited By ~ 102

Author(s):

Manfred Perlitz ◽

Thorsten Peske ◽

Randolf Schrank

Keyword(s):

Real Options ◽

Project Evaluation ◽

Real Options Valuation ◽

New Frontier ◽

Options Valuation

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Real Options Theory

Handbook of Research on Emerging Technologies for Effective Project Management - Advances in Logistics, Operations, and Management Science ◽

10.4018/978-1-5225-9993-7.ch001 ◽

2020 ◽

pp. 1-19

Author(s):

Hugo Ferreira Braga Tadeu ◽

Jersone Tasso Moreira Silva ◽

George Leal Jamil

Keyword(s):

Decision Making ◽

Project Management ◽

Real Options ◽

Project Evaluation ◽

Research Field ◽

Management Decision ◽

Real Options Theory ◽

Management Decision Making ◽

Innovation Project ◽

Options Theory

The objective of this chapter is to present the real options theory (ROT) as an alternative methodology applicable to investment analyses in research and development projects (R&D). The authors intend to simulate the evaluation of an R&D project as a real option, compare real options theory outcomes to a conventional R&D project evaluation technique, and review real options theory as a trend in innovation project evaluation. The outcomes were compared to those obtained via the traditional net present value (NPV) method and a brief practical discussion regarding project management decision making is held. Finally, although ROT is still in a developmental and consolidation stage, the authors suggests that it can be used as a promising tool in the decision-making process concerning R&D projects. ROT is presented as a research field that would integrate a set of emerging management technologies, becoming a theoretical base for new tools and methods to support project management (PM) decision making.

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