Gomme, Paul; Ravikumar, B; Rupert, Peter - Department of Economics, University of California-Santa … - 2007
We measure the return to capital directly from the NIPA and BEA data and examine the return implications of the real business cycle model. We construct a quarterly time series of the after-tax return to business capital. Its volatility is considerably smaller than that of S&P 500 returns. The...