The spirit of capitalism and the equity premium

Peer Reviewed
1 January 2015

This paper evaluates whether the spirit of capitalism can explain the equity premium puzzle. The spirit of capitalism implies that investors acquire wealth not just for consumption, but also to improve their social status. We set up a consumption-based capital asset pricing model incorporating this component. The simulated results from our calibrated model match the mean and the volatility of the equity premium observed in the data. 

Country

Request a publication

Due to Copyright we cannot publish this article but you are very welcome to request a copy from the author. Please just fill in the information beneath.

Authors I want to contact
Publication | 24 November 2016