Skip to main content

Optimal expenditure patterns for risky R&D projects with time-dependent returns

Buy Article:

$51.00 plus tax (Refund Policy)

Abstract:

The basic Lucas model for risky R&D projects is revisited. New solutions for optimal expenditures are explored by exploiting the merits of the theory of differential equations. After applying the calculus of variations, a nonlinear differential equation is presented whose solution provides the optimal control for a constant conditional-completion density function and different time-dependent return models. New, exact, and approximate solutions are presented and discussed. It is found, for the class of risky R&D projects under study, that the behavior over time of the optimal expenditure is functionally similar to that of the expected return.

Document Type: Original Article

DOI: http://dx.doi.org/10.1111/1467-9310.00175

Affiliations: Department of Industrial Engineering and Management, Ben‐Gurion University of the Negev, Israel

Publication date: July 1, 2000

bpl/radm/2000/00000030/00000003/art00005
dcterms_title,dcterms_description,pub_keyword
6
5
20
40
5

Access Key

Free Content
Free content
New Content
New content
Open Access Content
Open access content
Subscribed Content
Subscribed content
Free Trial Content
Free trial content
Cookie Policy
X
Cookie Policy
ingentaconnect website makes use of cookies so as to keep track of data that you have filled in. I am Happy with this Find out more