We derive a pricing formula for a European call option written on equity in a framework where returns and consumption covary with external happiness. Being a non-tradable variable, happiness is regarded as an extra variable in a parameterised version of state dependent utility. We derive an...

In finance theory the standard deviation of asset returns is almost universally recognized as a measure of risk. This universality continues to exist even in the presence of known limitations of using the standard deviation and also an extensive and growing literature on alternative risk...

Two strands of real estate research--that concerned with the relationships between securitized real estate and the underlying market and that dealing with the role of property in the wider economy--rarely are considered together. The paper utilizes the U.K. equity market and property company...