may affect the value of q, namely: Market hype and speculation, reflecting, for example, analysts' views of the prospects for companies, or speculation such as bid rumors. The "intellectual capital" of corporations, that is, the unmeasured contribution of knowledge, goodwill, technology and other intangible assets that a company may have but aren't recorded by accountants. Some companies seek to develop ways to measure intangible assets such as intellectual capital. See balanced scorecard. Tobin's q is said to be influenced by market hype and intangible assets so that we see swings in q around the value of 1. Kaldor's v and Tobin's q In his 1966 paper Marginal Productivity and the Macro-Economic Theory of Distribution: Comment on Samuelson and Modigliani co-authored with Luigi Pasinetti, Nicholas Kaldor introduced this relationship as part of his broader theory of distribution that was non-marginalist. This theory is today known as the ‘Cambridge Growth Model’ after the location (University of Cambridge, UK) where the theories was devised. In the paper Kaldor writes: The "valuation ratio" (v) [is] the relation of the market value of shares to the capital employed by corporations." Kaldor then goes on to explore the properties of v at a properly macroeconomic level. He ends up deriving the following equation: where c is net consumption out of capital, sw is the savings of workers, g is the growth rate, Y is income, k is capital, sc is savings out of capital and i is the fraction of new securities issued by firms. Kaldor then supplements this with a price, p, equation for securities which is as follows: He then goes on to lay out his interpretation of these equations: The interpretation of these equations is as follows. Given the savings-coefficients and the capital-gains-coefficient, there will be a certain valuation ratio which will secure just enough savings by the personal sector to take up the new securities issued by corporations. Hence the net savings of the personal sector (available for investment by the business sector) will depend, not only on the savings propensities of individuals, but on the policies of corporations towards new issues. In the absence of new issues the level of security prices will be established at the point at which the purchases of securities by the savers will be balanced by the sale of securities of the dis-savers, making the net savings of the personal sector zero. The issue of new