@inbook{06c7ac9a43f446b8832648b6583b4b65,
title = "Capabilities, Real Options, and the Resource Allocation Process",
abstract = "In this paper, we consider the relationship between the investment decision process and returns to investments in capabilities. We draw on characteristics of capabilities to develop a framework that identifies four components of the returns to an investment that are derived from industry-based versus firm-specific elements, and option and non-option elements. We then link these components to elements of the resource allocation process. In taking this approach we place the study of real options into the larger investment context, recognizing that they co-exist with and should be understood in conjunction with other investment characteristics. These arguments highlight the importance of connecting the investment process with realization of returns, thereby providing the conceptual foundations for a decision tool.",
author = "Maritan, {Catherine A.} and Alessandri, {Todd M.}",
note = "Funding Information: We thank Tammy Madsen and Rich Makadok for their helpful comments. We also thank participants in sessions at the Academy of Management, Strategic Management Society, and College on Organization Science conferences for their feedback on earlier versions of this work. Financial support from the University at Buffalo School of Management Summer Research Grant program is gratefully acknowledged. ",
year = "2007",
doi = "10.1016/S0742-3322(07)24011-2",
language = "English (US)",
isbn = "0762314273",
series = "Advances in Strategic Management",
pages = "307--332",
editor = "Jeffrey Reuer and Tony Tong",
booktitle = "Real Options Theory",
}