Effects of creative destruction on the size and timing of an investment
研究了产品寿命有限如何影响企业在双寡头竞争中的投资时机和规模选择，发现有限寿命会削弱抢先投资的动机，忽视这一因素会导致显著价值损失。
Today’s economy is innovation driven. Besides the launch of new innovative products, this implies that established products have a finite lifetime. This paper investigates its implications for optimal firm investments while explicitly taking into account that an investment decision is not only about timing, but also involves choosing the investment size. Moreover, we also consider strategic implications by implementing the finite product-life assumption in a duopoly framework. We find that in the duopoly setting, the project life being finite reduces the incentive to preempt the investment of the opponent. Furthermore, we obtain that considerable value losses will be achieved when the project life being finite is mistakenly not taken into account when making the investment decision.