Martzoukos, Spiros H.; Zacharias, Eleftherios - In: Omega 41 (2013) 2, pp. 236-249
We demonstrate to decision makers how to optimally make costly strategic pre-investment R&D decisions in the presence of spillover effects in an option pricing framework with analytic tractability. Decisions are modeled as impulse-type controls with random outcome. Two firms face two decisions...