Evaluating the Capacity of Standard Investment Appraisal Methods
AbstractThe survey findings indicate the existence of gap between theory and practice of capital budgeting. Standard appraisal methods have shown a wider project value discrepancy, which is beyond and above the contingency limit. In addition, the research has found the growing trend in the use of value management models. The presence of correlation between the frequency of monitoring and project value discrepancy, and the absence of uniformity in the use of evaluation methods throughout the life span of a project are among the results of the study.
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Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 02-082/1.
Date of creation: 20 Aug 2002
Date of revision:
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Capital Budgeting; Investment Appraisal; DCF Methods; Project Analysis; Shareholder Value Analysis; Value Management Techniques.;
Find related papers by JEL classification:
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
- L6 - Industrial Organization - - Industry Studies: Manufacturing
- L8 - Industrial Organization - - Industry Studies: Services
- L9 - Industrial Organization - - Industry Studies: Transportation and Utilities
- M10 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - General
- O22 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-12-02 (All new papers)
- NEP-CFN-2002-12-02 (Corporate Finance)
- NEP-RMG-2002-12-02 (Risk Management)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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CRSP working papers
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- Graham, John R. & Harvey, Campbell R., 2001. "The theory and practice of corporate finance: evidence from the field," Journal of Financial Economics, Elsevier, vol. 60(2-3), pages 187-243, May.
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