This research attempts to distinguish between two competing economic explanations of mean reversion in stock returns: 1) mispricing in irrational markets versus 2) predictable time variation in security risk premia. Excess portfolio returns are decomposed into 'explained' and 'unexplained'...

This paper addresses a particular form of price discrimination, known as "chaotic discrimination", that has the following features: sellers quote a common price but, in reality, they engage in secret and apparently unsystematic price discounts "which may be seriously inconsistent with...

In establishing convergence to the 'natural state,' this paper examines the allocation of capital by the 'captains of industry' who respond to profit rate differentials. Such allocations unleash the equilibration forces of competition. It is constructively shown that the problem of capital...