Growth Opportunities and Technology Shocks
We propose a theoretically motivated procedure for measuring heterogeneity in firms’ growth opportunities and document its empirical properties. The term “growth opportunities” refers to the component of a firm’s market value that cannot be attributed to its assets in place. This decomposition...
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| Other Authors: | |
| Format: | Article |
| Language: | en_US |
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American Economic Association
2011
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| Online Access: | http://hdl.handle.net/1721.1/64452 https://orcid.org/0000-0001-9387-9728 https://orcid.org/0000-0003-3408-1139 |
| _version_ | 1811068374870917120 |
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| author | Kogan, Leonid Papanikolaou, Dimitris |
| author2 | Program in Media Arts and Sciences (Massachusetts Institute of Technology) |
| author_facet | Program in Media Arts and Sciences (Massachusetts Institute of Technology) Kogan, Leonid Papanikolaou, Dimitris |
| author_sort | Kogan, Leonid |
| collection | MIT |
| description | We propose a theoretically motivated procedure
for measuring heterogeneity in firms’
growth opportunities and document its empirical
properties. The term “growth opportunities”
refers to the component of a firm’s market
value that cannot be attributed to its assets in
place. This decomposition of firm value underpins
many of the theoretical models describing
cross-sectional differences in firms’ investment
and stock return behavior. However, successful
applications of such models depend on the
quality of empirical measures of growth opportunities.
Our procedure identifies economically
significant differences in firms’ growth opportunities
which are not captured by the commonly
used empirical measures. |
| first_indexed | 2024-09-23T07:55:05Z |
| format | Article |
| id | mit-1721.1/64452 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T07:55:05Z |
| publishDate | 2011 |
| publisher | American Economic Association |
| record_format | dspace |
| spelling | mit-1721.1/644522022-09-23T09:37:41Z Growth Opportunities and Technology Shocks Kogan, Leonid Papanikolaou, Dimitris Program in Media Arts and Sciences (Massachusetts Institute of Technology) Sloan School of Management Kogan, Leonid Kogan, Leonid Papanikolaou, Dimitris We propose a theoretically motivated procedure for measuring heterogeneity in firms’ growth opportunities and document its empirical properties. The term “growth opportunities” refers to the component of a firm’s market value that cannot be attributed to its assets in place. This decomposition of firm value underpins many of the theoretical models describing cross-sectional differences in firms’ investment and stock return behavior. However, successful applications of such models depend on the quality of empirical measures of growth opportunities. Our procedure identifies economically significant differences in firms’ growth opportunities which are not captured by the commonly used empirical measures. Kellogg School of Management. Zell Center for Risk Research 2011-06-16T15:50:54Z 2011-06-16T15:50:54Z 2010-05 Article http://purl.org/eprint/type/JournalArticle 0002-8282 1944-7981 http://hdl.handle.net/1721.1/64452 Kogan, Leonid, and Dimitris Papanikolaou. 2010. "Growth Opportunities and Technology Shocks." American Economic Review: Papers & Proceedings, 100(2): 532–36. © 2010 AEA. https://orcid.org/0000-0001-9387-9728 https://orcid.org/0000-0003-3408-1139 en_US http://dx.doi.org/10.1257/aer.100.2.532 American Economic Review Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use. application/pdf American Economic Association MIT web domain |
| spellingShingle | Kogan, Leonid Papanikolaou, Dimitris Growth Opportunities and Technology Shocks |
| title | Growth Opportunities and Technology Shocks |
| title_full | Growth Opportunities and Technology Shocks |
| title_fullStr | Growth Opportunities and Technology Shocks |
| title_full_unstemmed | Growth Opportunities and Technology Shocks |
| title_short | Growth Opportunities and Technology Shocks |
| title_sort | growth opportunities and technology shocks |
| url | http://hdl.handle.net/1721.1/64452 https://orcid.org/0000-0001-9387-9728 https://orcid.org/0000-0003-3408-1139 |
| work_keys_str_mv | AT koganleonid growthopportunitiesandtechnologyshocks AT papanikolaoudimitris growthopportunitiesandtechnologyshocks |