Mehra, Rajnish - In: Foundations and Trends(R) in Finance 2 (2007) 1, pp. 1-81
Over two decades ago, Mehra and Prescott (1985) challenged the finance profession with a poser: the historical US equity premium is an order of magnitude greater than can be rationalized in the context of the standard neoclassical paradigm of financial economics. This regularity, dubbed "the...