The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Capital Budgeting

  • E. Solomon
Reference work entry


A sub-field within economics and finance, the principal concern of capital budgeting is the optimal deployment of funds into capital expenditures. The mainstream of the field, developed essentially in the 1950s and 1960s, consists of two threads of inquiry. (1) How should a company measure the investment worth of a capital expenditure proposal? (2) How should a company set the minimum required rate of return for a capital expenditure proposal?

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  6. ———. 1962. The theory of financial management. New York: Columbia University Press.Google Scholar

Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • E. Solomon
    • 1
  1. 1.