The crucial question: to invest or not to invest in research?

Should firms allocate a portion of their funds to research, seeking new technological knowledge that may not find immediate application in products or processes? Recently, more managers have been answering ‘no’ to this crucial question, because they feel that results are not observable after relatively short planning horizons have been adopted results cannot be fully appropriated by the firm that spent to obtain them research proves to be risky public institutions engage in research that is of potential value to the firm anyway.