Valuation of Japanese Corporations during the 1980s: evidence from an accounting dataset

Hiroki Arato and Katsunori Yamada ()
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Katsunori Yamada: Japan Society for the Promotion of Science and Graduate School of Economics and Graduate School of Economics, Osaka University

No 07-45, Discussion Papers in Economics and Business from Osaka University, Graduate School of Economics

Abstract: This paper applies the framework of McGrattan and Prescott (2005) to the Japanese economy using an accounting dataset. Restricting our attention to the steady growth path in the 1980s, we show that the estimated value of intangible capital in Japan is enormous compared to the U.S. and the U.K. cases. Interestingly, it is also found that when we consider the sub-period of 1987--1989, the so-called bubble period, the price-to-book-value ratio is quite close to one. This finding might imply that the stock price surge during the bubble period was not actually a bubble.

Keywords: Intangible capital; Stock prices; Price-to-book-value ratio (search for similar items in EconPapers)
JEL-codes: E01 E22 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2007-12
New Economics Papers: this item is included in nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:osk:wpaper:0745

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