Working Paper
Using SMVAM as a Linear Approximation to a Nonlinear Function: A Note
A study contending that the linear statistical market-value accounting model (SMVAM) is a reasonable approximation of the relationship between market and book equity for firms with positive balance sheets, but that the linear approximation is inadequate when the data sample includes firms whose balance sheets show a low or negative liquidation value.
Working Papers of the Federal Reserve Bank of Cleveland are preliminary materials circulated to stimulate discussion and critical comment on research in progress. They may not have been subject to the formal editorial review accorded official Federal Reserve Bank of Cleveland publications. The views expressed in this paper are those of the authors and do not represent the views of the Federal Reserve Bank of Cleveland or the Federal Reserve System.
Suggested Citation
Demirgüç-Kunt, Asli, and James B. Thomson. 1988. “Using SMVAM as a Linear Approximation to a Nonlinear Function: A Note.” Federal Reserve Bank of Cleveland, Working Paper No. 88-10.
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