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Valuation Of Intangible Capital In Agriculture

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  • White, Fred C.

Abstract

This study examines the valuation of research as intangible capital in agriculture using Tobin's q theory. The market value of public research capital is estimated to be 8.6 times higher than conventional assets. Private research capital is valued 5.2 times higher than conventional assets. The estimated valuation multiplier for all farm assets dropped 1/3 over the last decade. In recent years the valuation multiplier has dropped below a dollar, which indicated the market is undervaluing farm assets.

Suggested Citation

  • White, Fred C., 1995. "Valuation Of Intangible Capital In Agriculture," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 27(2), pages 1-9, December.
    • Handle: RePEc:ags:joaaec:15276
    DOI: 10.22004/ag.econ.15276
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    File URL: https://ageconsearch.umn.edu/record/15276/files/27020437.pdf
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    References listed on IDEAS

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    1. Cockburn, Iain & Griliches, Zvi, 1988. "Industry Effects and Appropriability Measures in the Stock Market's Valuation of R&D and Patents," American Economic Review, American Economic Association, vol. 78(2), pages 419-423, May.
    2. Zvi Griliches, 1984. "Market Value, R&D, and Patents," NBER Chapters, in: R&D, Patents, and Productivity, pages 249-252, National Bureau of Economic Research, Inc.
    3. Oscar R. Burt, 1986. "Econometric Modeling of the Capitalization Formula for Farmland Prices," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(1), pages 10-26.
    4. Hall, Bronwyn H, 1993. "The Stock Market's Valuation of R&D Investment during the 1980's," American Economic Review, American Economic Association, vol. 83(2), pages 259-264, May.
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    Cited by:

    1. Bronwyn H. Hall, 1999. "Innovation and Market Value," Finance 9902009, University Library of Munich, Germany.
    2. Magdalena Kozera-Kowalska, 2020. "Intellectual Capital: ISVA, the Alternative Way of Calculating Creating Value in Agricultural Entities—Case of Poland," Sustainability, MDPI, vol. 12(7), pages 1-19, March.
    3. Laurie Hunter & Elizabeth Webster & Anne Wyatt, 2005. "Measuring Intangible Capital: A Review of Current Practice," Australian Accounting Review, CPA Australia, vol. 15(36), pages 4-21, July.
    4. Matteo Migheli, 2013. "Relational capital, profitability and access to credit: evidence from a sample of Italian small firms," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 60(2), pages 221-233, June.

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