IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

Testing for a Unit Root in the Net Discount Rate: A Survey of the Empirical Results

Listed author(s):
  • Payne James E

    (Illinois State University)

This study provides a survey of the empirical results associated with testing for a unit root in the net discount rate. As suggested by the literature, the use of the historical average of the net discount rate in the calculation of the present value of lost future earnings is valid if the net discount rate follows a mean reverting, stationary process. However, if the net discount rate follows a mean averting, non-stationary process forensic economists should perhaps use the current value of the net discount rate in such calculations. A majority of the studies surveyed indicate that the net discount rate experienced a structural break in the late 1970s-early 1980s. In general, if the net discount rate is stationary as a result of a structural break, forensic economists should use the average net discount rate over the post-break period.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by De Gruyter in its journal Journal of Business Valuation and Economic Loss Analysis.

Volume (Year): 2 (2008)
Issue (Month): 2 (January)
Pages: 1-20

in new window

Handle: RePEc:bpj:jbvela:v:2:y:2008:i:2:n:4
Contact details of provider: Web page:

Order Information: Web:

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:bpj:jbvela:v:2:y:2008:i:2:n:4. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.