Faculty Scholarship 1994 - Present
The Association Between Firm Value and Economic Value Added
This study investigates the association between economic value added and value of Indian firms which are included in the COMPUSTAT-Global Vantage database. Results show that (1) consistent with theory, economic value added is positively and significantly associated with the firm value, and (2) contary to Stewart's (1991) expectation, the explanatory power of economic value added is smaller than that of earnings. Earnings are still the most important determinant of firm value.