This note deals with the simplified case of a principal (e.g., a firm's board of directors) which delegates execution of an economic activity to a business unit (or a subsidiary firm) managed by a manager. It is assumed that the manager has no control over the cash flows injected into the unit...

In this paper we examine the theoretical conditions under which a firm will have incentives to optimallychoose investment projects of duration that deviates from its stated horizon objective. Our approachconsiders a context in which investment horizon is subject to randomness and its length is...

This paper investigates the influence of a firm's financial status on the within-firm allocation of funds, reected in its plant-level investment and exit decisions.

The measure of the economic value has become a widely debated issue because, nowadays, more and more companies are focusing on creating value for their shareholders.