Boland Awarded 3-Year SSHRC Insight Grant
Date Published: April 8, 2019
Matthew Boland, Assistant Professor of Accounting, has been awarded a $55.8k 3 year SSHRC Insight Grant for work that promises to shake up government procurement policies.
His research is titled “Consequences and motivations behind estimates in capital budgeting. Evidence from government procurement.”
The research proposal opens, “Contracting with the government is big business. In fiscal year 2016 the US Federal Government spent approximately $461 billion on contracts. Procurement spending is extremely diverse with goods ranging from coffee to fighter jets and with services ranging from janitorial work to advanced security.”
Anecdotes, fines issued and media stories related to corruption and overcharging point to some of the problems with government procurement. Boland is delving into the observed anomaly of the number of contract awards whose values are round amounts ending in zeros, like $500,000.
Boland’s proposal notes, “Finance textbooks advocate for the use of sophisticated capital budgeting techniques, such as net present value analysis, but these techniques should not result in bids ending in zero.”
Through this research, Dr. Boland will attempt to validate this observation, explore what the contracts in question are for and finally, analyze the outcomes of the contract to determine whether the contracts ending in zeros have inferior outcomes. Inferior outcomes could include costly and time-consuming contract revisions.
This research stands to have significant implications for procurement policies in the US, Canada and beyond.
Boland attained his PhD in Management with a Finance Specialization from Queen’s University, and then taught finance at San Jose State University in California before joining the Department of Accounting at Saint Mary’s.. His research interests lie at the intersection of empirical finance, accounting, and political economy. In particular, his recent work has focused on US government contractors and two of these papers are currently being revised for resubmission at the Journal of Accounting and Economics and Accounting, Organizations, and Society.
#procurement #governmentcontracts #capitalbudgeting