A commentary on “Why DCF capital budgeting is bad for business and why business schools should stop teaching it”

Weil, Sidney; Oyelere, Peter

doi:10.1080/06939280500453064

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Capital Budgeting Models1

Managerial and Cost Accounting1

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2006

2011

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Article4

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Cited by 4 publications

(2 citation statements)

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“…Two commentaries on this very article, however, recommend that we not throw the baby out with the bathwater. Wouters [2006] and Weil and Oyelere [2006] see value in the framework offered by DCF modeling. Both argue that DCF models should be used in conjunction with other strategic investment decision models.…”

Section: Capital Budgeting Modelsmentioning

confidence: 99%

Topics In Finance Part VI Capital Budgeting

Laux

2011

AJBE

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This series on the theory of financial management offers insight into the roles of stockholder wealth maximization, the risk-return tradeoff, and agency conflicts as they apply to major topics in finance. The current article investigates capital budgeting. Much literature addresses this topic, with a number of articles challenging mainstream theories, some investigating agency problems, and a few empirically testing the relationships taught in most managerial finance classrooms.

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Section: Capital Budgeting Modelsmentioning

confidence: 99%

Topics In Finance Part VI Capital Budgeting

Laux

2011

AJBE

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“…Adler (2006a) provides an argument as to why discounted cash flow (DCF) capital budgeting is not suitable for business and why it should no longer be taught. Numerous authors comment on Adler's position, including Wouters (2006), Weil and Oyelere (2006), Simga-Mugan (2006), Jones (2006), Paisey (2006), and Fogarty (2006a). Adler (2006b) responds to these criticisms of his position regarding DCF-based capital budgeting.…”

Section: Managerial and Cost Accountingmentioning

confidence: 99%