Capital Rationing in New Product Development: a Literature Review
The literature introduces various approaches to the decision problem of Research and Development project selection for companies with capital constraints. In this study a literature review is conducted to provide an overview of the current literature by focusing on risks, procurement of the required data for the methods and their complexity. The journals selected for the literature review were evaluated by the scale of German Academic Association for Economic Research to ensure and guarantee an optimal level of quality. This study presents the most used methods for selecting Research and Development projects and also compares and analyzes their characteristics. The results show that there are different types of methods and they have different characteristics. Depending on what is more important to them, decision makers can either pay attention to the effort of obtaining the necessary information, the complexity of the methods or whether risk plays a role in the methods.