MIT Center for Digital Business Research Lunch Seminar

The Connection between the Stock Market and Productivity: Measuring the Value of Information Technology

By Adam Saunders
Ph.D. candidate, Information Technology group at the MIT Sloan School of Management

Abstract:
This paper analyzes the connection between the market value of a firm’s capital and the productivity of its inputs. We test the hypothesis that the securities markets may provide a reliable way to measure the value of information technology. We compare the returns from ordinary capital to those of IT capital, and examine whether the securities markets have bid up the value of IT assets by investors in search of higher returns. Our research is based on the premise that the financial value of a firm is equal to the sum of its assets – both tangible and intangible.

About the Speaker:
Adam Saunders is a Ph.D. candidate in the Information Technology group at the MIT Sloan School of Management. He is a deputized Census Bureau researcher and has been working with Professor Erik Brynjolfsson on a micro-level Census data project to study organizational changes that are associated with technology investments. His research attempts to quantify technology-related intangible assets that are playing a greater role in generating market value and productivity. Before entering MIT, Adam worked at the President’s Council of Economic Advisers in Washington, D.C. He holds an A.B. in Economics summa cum laude from Princeton University.

Please RSVP no later than Tuesday, April 29th