Necessarily untrue: on the use of the discounted cash flow formula in valuation of exploratory projects.
Résumé
This paper investigates the use of discounted cash flow (DCF) analysis for the valuation of exploratory projects. In order to account for the widespread use of a contested formula, while avoiding both over- and under-calculative explanations, it proposes to examine DCF as a valuation device, i.e. a material and discursive assemblage. The paper hence attempts to describe the worlds of DCF - the one sketched by its hypotheses and the one constructed through its use - by focusing on the valuation of joint research/licensing projects between pharmaceutical companies and biotechnology start-ups. Describing how the formula calculates sheds light on how it matters in practice. The paper shows that DCF acts as a coordination tool and plays a performative role, namely through nurturing market repertoires and through the effects that it induces in exploration activities.
Domaines
Sociologie
Origine : Fichiers produits par l'(les) auteur(s)
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