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The current survey research was conducted to identify and investigate the differences in theory and practices of capital budgeting decision (cost of equity capital approaches) in corporate sector of Pakistan. Developed countries researchers conducting regular surveys to highlight and minimize the gap between theory and practice, specially, US/UK finance researchers while, developing countries researchers has not shown much interest in this regard. Under the Positivist philosophical approach, this study has adopted quantitative survey method of research. The data was collected through convenient sampling from 173 CFOs/Directors Finance at one point in time. For analysis ordinal logistic and binary logistic regression was used. In case of cost of equity calculation approaches most of the firms depends upon the historical return on common stock approach than CAPM. CFOs adjust the discount rate for inflation risk and bankruptcy risk more frequently than for other risk factors.

Umar Siddique, Fateh Ullah, Sajid Rahman Khattak, Muhammad Tariq. (2019) Determinants of Cost of Equity Capital Approaches: Evidence from Pakistan, The Dialogue, Volume 14, Issue 2.
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