NBER WDBKNG PAPEI SFIUFS

TAL VAluE ND r VAlUE

William C. Brainard Matthew D. Shapiro

John B. Shaven

Workir Paper No. 3452

NM'IONAL RJREAU OF N4IC RESEM1

1050 Nassadiusetts Avenue can'bridge, Wt 02138 Septenter 1990

This paper was prepared for the nference in hotxr of James Tohin, New Haven, CT, May 6 ani 7, 1988. We are grateful th William Nelson for extremely valuable research assistance. This paper is part of NBER's research prtgrant in Financial Markets an ?.bnetary Econcmdcs. ny cpinions expressed are those of the authors ani not those of the National &reau of Econctiic Research.

NBER Working Paper #3452

September 1990

FUNflTAL VUJE AND W'T VAlUE

ABSTC

Mud of Janus bin's professional life has been devoted to studying the interrelationship between the goeds arx financial markets. His general

equilibrium açroathes stresses the interaction of the desiar1 for financial assets with the decision to a