Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/20201 
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dc.contributor.authorMerz, Monikaen
dc.contributor.authorYashiv, Eranen
dc.date.accessioned2009-01-28T16:12:22Z-
dc.date.available2009-01-28T16:12:22Z-
dc.date.issued2003-
dc.identifier.urihttp://hdl.handle.net/10419/20201-
dc.description.abstractWhat role does labor play in firms? market value? We explore this question using aproduction-based asset pricing model with frictions in the adjustment of both capital andlabor. We posit that hiring of labor is akin to investment in capital and that the two interact,with the interaction being a crucial determinant of market value behavior.We use aggregate U.S. corporate sector data to estimate firms? optimal hiring and investmentdecisions and the consequences for firms? value. We then decompose this value, therebyquantifying the link between firms? market value and gross hiring flows, employment, grossinvestment and physical capital. We find that a conventional specification – quadraticadjustment costs for capital and no hiring costs – performs poorly. Rather hiring andinvestment flows, unlike employment and capital stocks, are volatile and both are essential toaccount for market volatility. A key result is that firms? value embodies the value of hiring andinvestment over and above the capital stock.en
dc.language.isoengen
dc.publisher|aInstitute for the Study of Labor (IZA) |cBonnen
dc.relation.ispartofseries|aIZA Discussion Papers |x965en
dc.subject.jelE24en
dc.subject.jelE23en
dc.subject.jelE22en
dc.subject.jelG12en
dc.subject.ddc330en
dc.subject.keywordproduction-based asset pricingen
dc.subject.keywordlabor market frictionsen
dc.subject.keywordgross flowsen
dc.subject.keywordQ-modelen
dc.subject.keywordGMMen
dc.subject.stwUnternehmenswerten
dc.subject.stwPersonalbeschaffungen
dc.subject.stwInvestitionen
dc.subject.stwTobin's qen
dc.subject.stwCapital Asset Pricing Modelen
dc.subject.stwMarktwerten
dc.subject.stwSchätzungen
dc.subject.stwTheorieen
dc.subject.stwVereinigte Staatenen
dc.titleLabor and the Market Value of the Firm-
dc.typeWorking Paperen
dc.identifier.ppn377465968en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen

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