Rents, Technical Change, and Risk Premia: Accounting for Secular Changes in Interest Rates, Returns to Capital, Earnings Yields, and Factor Shares

Ricardo Caballero (), Emmanuel Farhi and Pierre-Olivier Gourinchas

Working Paper from Harvard University OpenScholar

Abstract: The secular decline in safe interest rates since the early 1980s has been the subject of considerable attention. In this short paper, we argue that it is important to consider the evolution of safe real rates in conjunction with three other first-order macroeconomic stylized facts: the relative constancy of the real return to productive capital, the decline in the labor share, and the decline and subsequent stabilization of the earnings yield. Through the lens of a simple accounting framework, these four facts offer insights into the economic forces that might be at work.

References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://scholar.harvard.edu/farhi/node/488731

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:qsh:wpaper:488731

Access Statistics for this paper

More papers in Working Paper from Harvard University OpenScholar Contact information at EDIRC.
Bibliographic data for series maintained by Richard Brandon ( this e-mail address is bad, please contact ).