The empirical implications of the consumption-oriented capital asset pricing model (CCAPM) are examined, and its performance is compared with a model based on the market portfolio. The CCAPM is estimated after adjusting for measurement problems associated with reported consumption data. The...

This article shows that real, total consumption growth deviations from normal stock market wealth effects lead economic growth. Consumers' expenditures reflect their information about employment opportunities and future real wage growth, as well as information about the volatility of future...