Augmentations to Multiple q Theory

In Sect. 2.1, we augment the q theory of investment for a single capital good to a framework that includes multiple categories of capital goods that have their own investment adjustment costs. The resulting Multiple q model establishes, under a set of assumptions that includes linear marginal adjustment costs, an estimable relationship between the investment rate of each capital good and the Total q, which is simply equivalent to the standard Single q evaluated in the stock market. In Sect. 2.2, we review the empirical research on the Multiple q model.