- Title Pages
- Dedication
- Preface
- 1 Modern Value Quandaries
- 2 Theories of Value
- 3 The Failure of the Neoclassical Investment Rule
- 4 The Nature of the Firm
- 5 The Organization and Scale of Private Business
- 6 Accounting for the Firm
- 7 VALUE IN CLASSICAL ECONOMICS
- 8 VALUE IN NEOCLASSICAL ECONOMICS
- 9 MODERN RECURSIVE EQUILIBRIUM AND THE BASIC PRICING EQUATION
- 10 ARBITRAGE-FREE PRICING IN COMPLETE MARKETS
- 11 Portfolio Pricing Methods
- 12 Real Options and Expanded Net Present Value
- 13 Traditional Valuation Methods
- 14 PRACTICAL APPLICATION OF THE INCOME METHOD
- 15 THE VALUE FUNCTIONAL: THEORY
- 16 The Value Functional: Applications
- 17 APPLICATIONS: FINANCE AND VALUATION
- 18 Applications: Law and Economics
- Appendix A Key Formula and Notation Summary
- Appendix B Guide To The Solutions Manual
- Appendix C Description of Subject Companies
- References
- Index
Theories of Value
Theories of Value
- Chapter:
- (p.14) 2 Theories of Value
- Source:
- The Economics of Business Valuation
- Author(s):
Patrick L. Anderson
- Publisher:
- Stanford University Press
This chapter reviews the common definition of “market value” in Economics, and the practical use of the term in tax, accounting, and other fields. It then introduces ten different valuation theories. Among these are three different valuation principles derived from the Economics literature, three traditional methods of valuation, three from Mathematical Finance, and one novel principle that emerges from both Economics and Control Theory. Each of these is based on principles distinct from each other, in the sense that each fundamentally derives “value” from a different source.
Keywords: value, Accounting, Finance, Control Theory, traditional valuation methods, Value Functional, Income method
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- Title Pages
- Dedication
- Preface
- 1 Modern Value Quandaries
- 2 Theories of Value
- 3 The Failure of the Neoclassical Investment Rule
- 4 The Nature of the Firm
- 5 The Organization and Scale of Private Business
- 6 Accounting for the Firm
- 7 VALUE IN CLASSICAL ECONOMICS
- 8 VALUE IN NEOCLASSICAL ECONOMICS
- 9 MODERN RECURSIVE EQUILIBRIUM AND THE BASIC PRICING EQUATION
- 10 ARBITRAGE-FREE PRICING IN COMPLETE MARKETS
- 11 Portfolio Pricing Methods
- 12 Real Options and Expanded Net Present Value
- 13 Traditional Valuation Methods
- 14 PRACTICAL APPLICATION OF THE INCOME METHOD
- 15 THE VALUE FUNCTIONAL: THEORY
- 16 The Value Functional: Applications
- 17 APPLICATIONS: FINANCE AND VALUATION
- 18 Applications: Law and Economics
- Appendix A Key Formula and Notation Summary
- Appendix B Guide To The Solutions Manual
- Appendix C Description of Subject Companies
- References
- Index
