TY  - JOUR
AU  - Hall,Robert E.
TI  - The Stock Market and Capital Accumulation
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 7180
PY  - 1999
Y2  - June 1999
UR  - http://www.nber.org/papers/w7180
L1  - http://www.nber.org/papers/w7180.pdf
N1  - Author contact info:
Robert E. Hall
Hoover Institution
Stanford University
Stanford, CA  94305-6010
Tel: 650/723-2215
E-Mail: rehall@gmail.com
AB  - If firms purchase capital up to the point where there is no further marginal benefit, and the firms' securities are equal in value to the capital, then the market value of securities measures the quantity of capital. I explore the implications of this hypothesis using data from U.S. non-farm, non-financial corporations over the past 50 years. The hypothesis implies that corporations have formed large amounts of intangible capital, especially in the past decade. The resources for expanding capital have come from the output of the existing capital. An endogenous growth model can explain the basic facts about corporate performance, with only a modest increase in the productivity of capital in the 1990s.
ER  -