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ESSAYS ON GOVERNMENT CONTRACTING AND PRIVATE INVESTMENT FIRMS: IMPLICATIONS FOR CORPORATE FINANCE

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Date Issued:
2022
Abstract/Description:
The modern organization is “a nexus of contracts” among various stakeholders. In this two-essay study, I examine how contracts surrounding entrepreneurial firms, namely contracts with the U.S. government agencies as customers and contracts with venture capital (VC) firms as investors, interact. In the first essay, I examine whether and how the ex-post government contracting activity of portfolio companies affects the performance of VC investments. Prior research establishes the impact of government customers on the contractor's operating performance and information quality. I find that government contracting improves the likelihood of successful exits via initial public offering (IPO) or acquisition and reduces the likelihood of a liquidation. I also find that the suppliers’ bargaining power relative to the government moderates the relationship between government contracting and VC investment exits. The increased suppliers’ bargaining power mitigates the positive relationship between government contracting and the likelihood of IPOs. The impact of government contracting on the likelihood of acquisitions and liquidations is more substantial for suppliers with greater bargaining power. The results are robust for reputable and non-reputable VC firms, alternative model specifications, and adjustments for potential endogeneity.
Title: ESSAYS ON GOVERNMENT CONTRACTING AND PRIVATE INVESTMENT FIRMS: IMPLICATIONS FOR CORPORATE FINANCE.
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Name(s): Suleymanov, Masim, author
Cumming, Douglas , Thesis advisor
Javakhadze, David , Thesis advisor
Florida Atlantic University, Degree grantor
Department of Finance
College of Business
Type of Resource: text
Genre: Electronic Thesis Or Dissertation
Date Created: 2022
Date Issued: 2022
Publisher: Florida Atlantic University
Place of Publication: Boca Raton, Fla.
Physical Form: application/pdf
Extent: 188 p.
Language(s): English
Abstract/Description: The modern organization is “a nexus of contracts” among various stakeholders. In this two-essay study, I examine how contracts surrounding entrepreneurial firms, namely contracts with the U.S. government agencies as customers and contracts with venture capital (VC) firms as investors, interact. In the first essay, I examine whether and how the ex-post government contracting activity of portfolio companies affects the performance of VC investments. Prior research establishes the impact of government customers on the contractor's operating performance and information quality. I find that government contracting improves the likelihood of successful exits via initial public offering (IPO) or acquisition and reduces the likelihood of a liquidation. I also find that the suppliers’ bargaining power relative to the government moderates the relationship between government contracting and VC investment exits. The increased suppliers’ bargaining power mitigates the positive relationship between government contracting and the likelihood of IPOs. The impact of government contracting on the likelihood of acquisitions and liquidations is more substantial for suppliers with greater bargaining power. The results are robust for reputable and non-reputable VC firms, alternative model specifications, and adjustments for potential endogeneity.
Identifier: FA00013917 (IID)
Degree granted: Dissertation (Ph.D.)--Florida Atlantic University, 2022.
Collection: FAU Electronic Theses and Dissertations Collection
Note(s): Includes bibliography.
Subject(s): Public contracts
Venture capital
Corporations—Finance
Persistent Link to This Record: http://purl.flvc.org/fau/fd/FA00013917
Use and Reproduction: Copyright © is held by the author with permission granted to Florida Atlantic University to digitize, archive and distribute this item for non-profit research and educational purposes. Any reuse of this item in excess of fair use or other copyright exemptions requires permission of the copyright holder.
Use and Reproduction: http://rightsstatements.org/vocab/InC/1.0/
Host Institution: FAU
Is Part of Series: Florida Atlantic University Digital Library Collections.