Finance Discipline Group
UTS Business School
University of Technology, Sydney

Working Paper Series

Miller Modigliani and Ohlson: A Note on an Old Model in New Clothes
Author(s): Graham Partington
Date of publication: April 1993
Working paper number: 29
This note demonstrates that Ohlson's (1991) earnings capitalisation model is not a new model, but rather a special case of an earlier earnings capitalisation model developed by Miller Modigliani (1961). The special case arises from a "np growth" condition, which is inherent in Ohlson's model. Ohlson's model can also be interpreted as a standard price earnings model. The "no growth" condition is an important restriction on generalisation of the model.
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