The publication titled "Should One Assume the Discount Rate to Be One of the Risk Factors?" by dr Jan Kaczmarzyk has been awarded the prize for the best article published in the journal Financial Sciences (2080-5993) in 2023 (70 points according to the ministerial list applicable in the year of publication). The article focuses on the implications of what the author considers an unwarranted assumption—that the discount rate in asset valuation or risk-inclusive profitability assessments can be treated as a risk factor and assigned a probability distribution during Monte Carlo simulations.
The competition committee, consisting of Dominika Hadro (University of Economics in Wrocław), Justyna Fijałkowska (Social Academy of Sciences), Karol Marek Klimczak (Lodz University of Technology), Marek Pauka (University of Economics in Wrocław), and Enrico Supino (University of Bologna, Italy), unanimously decided to grant the award.
The committee praised the author's critique of existing approaches:
"The research challenges conventional views on discount rates in risk analysis through well-structured arguments and a detailed financial model. Its findings hold practical significance for corporate finance, investment analysis, and risk management, offering valuable insights for financial analysts. The article enhances its academic relevance by engaging with key scholars like Damodaran. With a strong methodology, theoretical foundation, and practical applicability, it contributes to financial literature and is well-positioned for further academic recognition."
The article "Should One Assume the Discount Rate to Be One of the Risk Factors?" continues the discussion initiated in dr Jan Kaczmarzyk's monograph "The Income Value of a Company Exposed to Business Risk" submitted as part of his habilitation proceedings. The monograph can be accessed online.
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