Research On Diffusion, Competition And Interaction Models Of Technological Innovation Based On The Real Option Approach

Technological innovations are composed of adopting and providing (R&D) technologies, which are two interactive aspects. There always exist a lot of uncertain factors in the investment decisions of two aspects. These uncertainties entitle firms a lot of dynamic decision flexibility. Because a series of value of decision flexibility of technological innovation investment are not considered by the classical investment evaluating approaches (NPV method), these traditional approaches can't make scientific analysis and appraisal to the investments of technological innovations. On the other hand, the real option analyzing approach considers the value of the decision flexibility, and the important characteristic of its analyzing way is to incorporate investment decision into market evaluation. Thus, the real option approach can offer more scientific analytical approaches and evaluation models for technological innovations and innovative firms.Based on the survey of the real option analyzing approach to investments of technological innovations, aiming at the deficiencies of the extant study, we study mainly the firms' investment strategies of technological innovation by real option approaches, involving technology adoption timing and innovation diffusion, imperfect competition and interactive mode.On study of technology adoption timing and innovation diffusion, we get the firm's optimal threshold of technology adoption under the uncertainties about both the time of the arrival and efficiency of improvement of technologies, and give the relevant cumulative probability distribution function regarding adopting technology timing. Furthermore, under decreasing adoption cost as technology progress, we study the optimal technology adoption strategies. When analyzing the circumstance in which there are two generations of new technologies in the future, we find that the faster the speed of technological innovation is, the more likelihood the firm wait to adopt the next generation of new technology. Moreover, the smaller the average extent of decreasing adoption cost of technologies, the more obvious the trend is. At last, we provide the calculating method of firm's investimg at latest under firm's facing infinite generations of new technologies in the future.