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The Rate of Return on Everything, 1870–2015

Author

Listed:
  • Òscar Jordà
  • Katharina Knoll
  • Dmitry Kuvshinov
  • Moritz Schularick
  • Alan M. Taylor

Abstract

This paper answers fundamental questions that have preoccupied modern economic thought since the 18th century. 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 dataset for all major asset classes, including—for the first time—total returns to the largest, but oft ignored, component of household wealth, 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 insights and puzzles.

Suggested Citation

  • Òscar Jordà & Katharina Knoll & Dmitry Kuvshinov & Moritz Schularick & Alan M. Taylor, 2017. "The Rate of Return on Everything, 1870–2015," NBER Working Papers 24112, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:24112
    Note: AP DAE EFG IFM ME
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    References listed on IDEAS

    as
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    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Fiscal Sustainability: A Primer
      by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets on 2018-07-02 12:02:05

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    Cited by:

    1. Dennis Bonam & Peter van Els & Jan Willem van den End & Leo de Haan & Irma Hindrayanto, 2018. "The natural rate of interest from a monetary and financial perspective," DNB Occasional Studies 1603, Netherlands Central Bank, Research Department.

    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E10 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - General
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative

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