Technological Innovation Investment Option Game Analysis

Based on the domestic and international scholar researches, this paper explains the method of investment research, and points out the main factors influenced the investment decision of the project include irreversibility of the cost, uncertainty of the project and competitiveness caused by sharing among the competitors of option. This paper is starting under the condition that the traditional evaluation method can not deal with irreversible character, uncertainty, flexibility and competitive strategy in investment. The options and games method is a good way to evaluate them. Secondly, this paper introduces the concept of real option and the theory of fixed price. It also summarized the fixed price theory in kind, the general analysis frame, the theory's development history and current situation. Thirdly, based on option-game theory, we analyze the strategies and behaviors of technological innovation investment on enterprise under the conditions of monopoly and competition by establishing corresponding option-game models, and carry on the balanced analysis. I also take specific examples of data confirms this conclusion. Fourth, the paper discusses the option gambling analysis method which the technology turned to a new generation, and accounted the enterprise's value function when it containing technology updating and upgrading. Seek out the optimum crisis value that enterprise invests in and discuss the time parameter A that technology arrival. And give out optimum investment decision specifically for different new technique time of arrival.