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The perfect market paradigm provides a powerful foundation for financial theory. In perfect capital markets, there are no transaction costs, all traders have equal and cost-less access to information, and traders act as price takers. If existing claims" span" the state space, excess supply curves are perfectly elastic. Moreover, differences in preferences or beliefs do not result in disagreement among shareholders about firm policies. Underlying this unanimity is the shared valuation of the stock, which translates into agreement about firm strategies. The ability to transact without affecting the market price is central to many important propositions, including the Modigliani-Miller irrelevance theorems. This paper examines the nature of supply curves for corporate equity. Until recently there has been little direct empirical assessment of their elasticity. At issue is whether or not the supposition of shareholder homogeneity of …