Kulatilaka, Nalin; Perotti, Enrico C. - In: Management Science 44 (1998) 8, pp. 1021-1031
We provide a strategic rationale for growth options under uncertainty and imperfect competition. In a market with … investment in growth options: higher uncertainty means more opportunity rather than simply larger risk. If the strategic effect … is weak, the reverse is true. On the other hand, an increase in systematic risk discourages the acquisition of growth …