Asset prices and rents in a ge model with imperfect competition
By: Pierre Lafourcade.
Series: Finance and economics discussion series ;; 2003-60; Finance and economics discussion series (Online) ;; 2003-60.
Publisher: Federal Reserve Board
Published: 2003
Place of publication: Washington, D.C
Language: eng
Format: Electronic resource
Description: "This paper analyses the general equilibrium effects on asset valuation and capital accumulation of an exogenous drop in the rate of return required by investors in a model of production with imperfectly competitive product markets.  The model improves substantially on the standard perfectly competitive neo-classical framework, by dissociating the behavior of marginal and average q.  It tracks more closely current observed data on the ratio of stock-market value to the economy's capital base, while uncoupling this valuation ratio from investment behavior.  The model does so by assuming that asset holders price not only the future marginal productivity of capital, but also the value of monopoly franchises, which arise from the interplay of market power and returns to scale"--Federal Reserve Board web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 7/20/2004.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.