Real Option Valuation in Service Industries (Gabler Edition Wissenschaft) (German Edition)

Uncertainty is the greatest risk management faces, but it also provides enormous opportunities for value creation. Basing strategic decisions on theoretically rigorous analysis is therefore vital to long-term corporate success in an uncertain and changing marketplace. The real option approach is the tool to integrate the values of flexibility and uncertainty into capital budgeting. Jürgen Müller applies the real option approach to service industries, in this case to retail banking; he provides empirical support for the approach and simplifies the applicability of real option concepts in corporate practice. Based on a case study of the Polish retail banking market, the author develops and illustrates a simplified approach to real option valuation based on the binomial option pricing model. Front Matter....Pages I-XXV Introduction....Pages 1-9 Retail Banking in an emerging market: The case of Poland....Pages 11-36 The evaluation of capital investment decisions....Pages 37-106 Applying real option valuation to a retail banking startup in Poland....Pages 107-218 Critical review and outlook....Pages 219-221 Back Matter....Pages 223-267