A market reaction to DOD contract delay — Does the market reward poor performance?

Robert Carden, Sonia E. Leach and Jeffrey S. Smith

Review of Financial Economics, 2008, vol. 17, issue 1, 33-45

Abstract: Civilian development projects occur faster than projects for the Department of Defense (DoD). Faster development either means quicker delivery (i.e. sales), or for DoD, it means a more capable warfighter. On average, DoD Acquisition Category One (ACAT I) development projects now take 15 years, an increase of 20%. These same companies producing civilian products faster fail to do so with their DoD contracts. This paper examines the relationship between DoD delay and its impact on shareholder wealth. The results show positive, significant wealth for shareholders at the announcement of a DoD delay, suggesting an insensitivity toward such production delays.

Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1016/j.rfe.2007.02.004

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wly:revfec:v:17:y:2008:i:1:p:33-45

Access Statistics for this article

More articles in Review of Financial Economics from John Wiley & Sons
Bibliographic data for series maintained by Wiley Content Delivery ().