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management of innovation. Results are organised in two categories. On the one hand, information asymmetry is considered as a … innovation under asymmetric information. …
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' signaling-driven investment, despite the risk of buying a bad innovation. We finally show at what point the presence of active …
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aggressive development of a basic innovation by better informed venture-backed firms is used as a signaling device to enhance the … sale price of the innovation. We then show that incumbents can undertake early, preemptive, acquisitions to prevent such … signaling driven overinvestment, despite the risk of buying a non-productive innovation. Therefore, to exist in equilibrium …
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We model the impact of public and private ownership structures on firms' incentives to invest in innovative projects. We show that it is optimal to go public when exploiting existing ideas and optimal to go private when exploring new ideas. This result derives from the fact that private firms...
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