Fisher Equation Revisited – Nominal Rate of Return, Real Rate of Return, Inflation, and Capital Maintenance

Abstract What is the aggregate real rate of return in the economy? Is it higher than the growth rate of the economy and, if so, by how much? Is there a tendency for returns to fall in the long run? Which particular assets have the highest long-run returns? We answer these questions on the basis of a new and comprehensive data set for all major asset classes, including housing. The annual data on total returns for equity, housing, bonds, and bills cover 16 advanced economies from 1870 to 2015, and our new evidence reveals many new findings and puzzles.

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Estimating the real rate of return on potential P2 investments

P2 Pollution Prevention Review ◽

10.1002/(sici)1520-6815(199824)8:1<69::aid-ppr6>3.3.co;2-c ◽

1998 ◽

Vol 8 (1) ◽

pp. 69-81

Author(s):

James R. Aldrich

Keyword(s):

Rate Of Return ◽

Real Rate ◽

The Real

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The Islamic Rate of Return Versus the Nominal Rate of Interest: A Macroeconometric Model

Eastern Economic Journal ◽

10.1057/s41302-020-00170-8 ◽

2020 ◽

Author(s):

Ibrahim L. Awad

Keyword(s):

Rate Of Return ◽

Macroeconometric Model ◽

Nominal Rate

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Household Saving in Pakistan: Some Findings from Time-Series Data

The Pakistan Development Review ◽

10.30541/v20i4pp.375-397 ◽

1981 ◽

Vol 20 (4) ◽

pp. 375-397 ◽

Cited By ~ 1

Author(s):

Zia M. Qureshi

Keyword(s):

Time Series ◽

Time Series Data ◽

Rate Of Return ◽

Series Data ◽

Financial Assets ◽

Household Savings ◽

Real Rate ◽

Current Income ◽

Household Saving ◽

Income Model

The paper tests some household savings hypotheses with time-series data for Pakistan over the 1950-51 - 1976-77 period. The permanent income model is found to give a much better explanation of the year-to- year variations in household saving than does the simple current income model. Among other findings is a highly significant correlation between ch;lI1ges in the real rate of return on financial assets and household saving.

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Examining the financial performance of agricultural cooperatives in the USA

Agricultural Finance Review ◽

10.1108/afr-11-2017-0103 ◽

2019 ◽

Vol 79 (2) ◽

pp. 271-282 ◽

Cited By ~ 4

Author(s):

Krishna Prasad Pokharel ◽

Madhav Regmi ◽

Allen M. Featherstone ◽

David W. Archer

Keyword(s):

Interest Rate ◽

Financial Performance ◽

Financial Stress ◽

Rate Of Return ◽

Agricultural Cooperatives ◽

Return On Assets ◽

Real Rate ◽

Content Type ◽

Return On Equity ◽

The Real

Purpose The purpose of this paper is to identify financial stress and the causes of financial stress for agricultural cooperatives and provide management recommendations to stakeholders including cooperatives’ managers, boards of directors and lenders. Design/methodology/approach This research used the geometric mean of the real rate of return on equity to identify financially stressed agricultural cooperatives. The real rate of return on equity allows the allocation of total financial stress among the return on assets, leverage and interest rate issues. Findings This study found that financially non-stressed agricultural cooperatives had a higher rate of return on equity and rate of return on assets, but lower leverage ratios and interest rates than stressed agricultural cooperatives. Further, non-stressed cooperatives had higher total assets and sales compared to stressed cooperatives. This suggests that smaller cooperatives are more likely to face financial stress than larger cooperatives. The decomposition of the financial problem showed that a substantial percentage of financial stress was correlated with a low return on assets or profitability. A smaller percentage of financial stress was due to financing decisions. Originality/value This study provides value by measuring the impact of profitability, leverage and interest rate on the financial performance of agricultural cooperatives. Results showed that a substantial proportion of financial stress was associated with a low return on assets. This indicates that profitability is a problem for agricultural cooperatives. This study also examines profitability during a period of volatile returns in production agriculture.

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An empirical analysis of the investment performance of the Chilean pension system

Journal of Pension Economics and Finance ◽

10.1017/s1474747202001208 ◽

2003 ◽

Vol 2 (1) ◽

pp. 7-24 ◽

Cited By ~ 8

Author(s):

H. FRED MITTELSTAEDT ◽

JOHN C. OLSEN

Keyword(s):

Mutual Funds ◽

Pension System ◽

Rate Of Return ◽

Real Rate ◽

Investment Performance ◽

Fund Managers ◽

Individual Account ◽

Stock Indices ◽

Monthly Return ◽

Account System

The Chilean national pension system is often viewed as the model for moving from a pay-as-you-go system to a prefunded, individual account system. One measure of its success has been its 12% average real rate of return. This study uses monthly return data to examine the source of these returns and to compare the risk-adjusted returns of the pension system to those of Chilean stock indices, debt instruments, and mutual funds. Tests using the Sharpe ratio and the multi-factor Jensen alpha suggest that the pension returns are consistent with the overall riskiness of the Chilean economy. Based on our findings, neither the structure of the Chilean pension system nor the performance of the fund managers should permit the system to earn abnormally high returns in the future.

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The Role Of Stochastic Dominance In Determining Discount Rates In Tort Cases

Journal of Business & Economics Research (JBER) ◽

10.19030/jber.v8i3.697 ◽

2010 ◽

Vol 8 (3) ◽

Author(s):

David Gordon

Keyword(s):

Discount Rate ◽

Stochastic Dominance ◽

General Concept ◽

Font Size ◽

Real Rate ◽

Legal Cases ◽

Different Types ◽

Future Income ◽

Nominal Rate

In this paper the basic responsibilities of a forensic economist are introduced. The role of the discount rate in this process is explained. Prior research on the choice of an appropriate discount rate is examined. The forensic economist must choose either a real rate of interest or a nominal rate. The choice is further compounded by the possible need to utilize a risk adjusted interested rate. The role of the variance and stochastic dominance is then examined. Different types of stochastic dominance are explained. It is found that the concept of stochastic dominance is a more general concept of risk than the variance and thus could be more accurate to use when evaluating future income streams in legal cases involving torts.

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Analisys of round wood production and profit sharing of Shorea leprosula and Shorea smithiana at PT Inhutani I Bukit Bangkirai Balikpapan

AGRIFOR ◽

10.31293/af.v18i1.3935 ◽

2019 ◽

Vol 18 (1) ◽

pp. 1

Author(s):

Moises Soares ◽

Abubakar M Lahjie ◽

BDAS Simarangkir ◽

Yosep Ruslim

Keyword(s):

Tree Species ◽

Economic Valuation ◽

Economic Value ◽

Profit Sharing ◽

Rate Of Return ◽

Wood Production ◽

Round Wood ◽

Nominal Rate ◽

Shorea Leprosula

This study investigated the roundwood production and profit sharing for Shorea leprosula and Shorea smithiana in case of PT Inhutani I Bukit Bangkirai, Balikpapan. Five research aims pursued in order to better understand the economic valuation of Shorea tree species, are: 1) analyse the increments of woody; 2) identify the age of trees reached the highest increments of woody; 3) measure the highest value of mean annual increments (MAI); 4) examine the nominal rate of return (i) for roundwood production; 5) examine the profit sharing between the management of PT Inhutani I Bukit Bangkirai and investors. Additionally, the policy of profit sharing has been determined by the proportion of 55% for investors and 45% for the management.The results demonstrated that: 1) the wood potential of Shorea leprosula reached the highest value at the age of 40 years by producing 7.78 m3 ha-1 year-1, and Shorea smithiana reached the highest value at the age of 50 years by producing 333.34 m3 ha-1 year-1; 2) the highest value of MAI for Shorea leprosula and Shorea smithiana are 7.78 and 6.67 m3 ha-1 year-1 respectively; 3) the nominal rate of return (i) of Shorea leprosula is 7.8% for investors and 8.3% for the management, and Shorea smithiana is 6.3% for investors and 6.7% the management. Overall, this research found that the economic value of Shorea leprosula and Shorea smithiana provide the nominal rate of return (i), which is higher than minimum acceptable rate of return (MAR).

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