Abstract

We use detailed establishment-level data to understand whether and how the composition of the US stock market differs from the composition of US firms as a whole. Although the locational composition of employment in public firms is similar to that of all US firms, we find certain industries significantly overrepresented. Further, the gap between the industrial composition of publicly traded firms and all US firms has grown over the last thirty years. Despite this, we show that stock market returns within industries and geographic areas predict employment changes in those industries and geographies.

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• Keyword(s):
• investments 83

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