How well do the assumptions behindd modigliani-miller match what happens in the ... | Hacker News

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		soVeryTired on Sept 23, 2016 \| parent \| context \| favorite \| on: Ask HN: What are the must-read books about economi... How well do the assumptions behindd modigliani-miller match what happens in the real world? I think 'invalidated' is a little strong. Do be aware that within economic models, the map is not the territory.

semi-extrinsic on Sept 23, 2016 [–]

Well, it assumes no taxes (so it would only apply to Apple et al.), and also symmetric information and an efficient market (which are both debatable).

soVeryTired on Sept 24, 2016 | [–]

The assumptions are extremely strong, and the theory is not robust to changes in those assumptions. Agree?

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