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Effect of expedited payments on project delays: Evidence from the QuickPay reform
Vibhuti Dhingra1, Volodymyr Babich2, Harish Krishnan3, Jie Ning4
1York University; 2Georgetown University; 3University of British Columbia; 4Case Western Reserve University
We study how payment delays affect project delays. We develop theories linking the two, and empirically test our hypotheses using the QuickPay reform, which expedited payments to certain projects, as an exogenous shock. Surprisingly, faster payments led to greater project delays. We identify contractor liquidity constraints and aggressive bidding as causes for this increase. We also reveal a spillover effect: some projects are accelerated although their payment timing is unaffected by QuickPay.
Empirical investigation of the valuation premium effect of target Firms’ operations capability in M&As
Mehdi Nezami3, Sara Rezaee Vessal2, Ali Shantia1
1Toulouse Business School; 2ESSEC Business School; 3Foster College of Business, Bradly University
Valuation of target firms in mergers and acquisitions (M&As) has far-reaching implications for shareholder wealth. This study investigates the effect of a target’s operations capability on the valuation premiums above its market value. We find that target firms’ operations capability has a positive effect on their M&A valuation premiums. However, this effect becomes weaker with increasing market overlap between the target and acquiring firms.
