Firm Valuation and Maximization using System Dynamics

Why did you decide to do a PhD in system dynamics?

Inadequacy of long-range planning tools is commonly cited reason for corporate failure to achieve their stated objectives. I believe System Dynamics provides methods, models, techniques and tools to adequately describe, analyse, and understand complex dynamic problems and to design and assess the impact of policies over time.

Strategic corporate finance is at the core of this complexity, yet this research area has not often been the subject of non-linear, dynamic feedback analysis. To fill this gap, I decided to write a phd based on this method.

Short summary of PhD project

Firm value maximization is the core objective of a firm. I am investigating fundamental principles in corporate finance by way of modelling and simulation using the System Dynamics approach. For this purpose, the core part of my study is to develop a corporate financial model of an oil firm in Norway. The model is aimed at addressing the three major principles of corporate finance namely; investment, financing and dividend decisions. The objective of the model is to support strategy development, policy design and decision making aimed at firm value maximization.

Hopefully, I can contribute to the field by highlighting some insights into the phenomenon of firm value by modelling the system structure that explains the fundamental sources of enhancing and sustaining the firm value via interaction of different policies and variables that are intertwined in feedback processes.

Aima Khan defended her doctoral thesis on 11.02.2022:

Khan, A. (2022). Essays in Corporate Finance [Doctoral Thesis, University of Bergen]. https://bora.uib.no/bora-xmlui/handle/11250/3011188.