Importance And Behavior Of Capital Project Benefits Factors In Practice: Early Evidence

Abstract

We extend the capital budgeting literature by identifying capital project benefits factors and relating each factor’s importance to firm and individual decision-maker factors.  We find significant and consistent changes in importance of project benefits factors associated with decision-maker firm-individual factors.  Project benefits such as value, scale, profitability, strategic fit, competitiveness, communications and implimentability importance can be explained by decision-makers' firm size or type, line/staff distinctions, power, experience, and behavioral training.