A STUDY OF CAPITAL BUDGETING PRACTICES IN GERMANY

摘要

This study provides empirical evidence on the capital budgeting processes in a sample of German firms. The study extends previous work by Payne, Heath, and Gale (Financial Practice and Education 1999), Kester et. al (Financial Practice and Education 1999), Mukherjee and Hingorani (Financial Practice and Education 1999), Jog and Srivastava (Financial Practice and Education 1995) examining differences in capital budgeting practices followed by US and Canadian firms and firms in the Asia Pacific Region. The results show that in Germany, the size of the firm impacts the choice of capital budgeting technique. Smaller German firms are less likely to use discounted cash flow techniques for capital budgeting evaluation.