Survey of option game theory of R&D investment

The paper generally analyzes the development history of option game theory about R&D based on the knowledge of common meaning of enterprise R&D strategy. Like other branch realms of the option game theories, the research of R&D investment option game theory comes from the innovative contributions of Smet (1991), Dixit & Pindyck(1994, 1996), Smit& Ankum(1993), and Smit & Trigeorgis(1997). On the basis of these papers, option game theory of R&D investment can not only handle the uncertainty of R&D or technology adoption, but also the problems of strategic technology adoption taking into account network effects, and the option game equilibrium of multi-stage R&D (or patent) competition. The latest development comes from these papers which consider asymmetric information or cooperative behavior. In sum, the general framework of option game theory on R&D investment is still needed to develop.