Abstract The equity variance risk premium is the expected compensation earned for selling in markets. positive and shows only moderate persistence. High premiums coincide with left tail of consumption growth distribution shifting down. These facts, together risk-neutral skewness being substantially more negative than physical return skewness, refute bulk extant consumption-based asset pricing m...

In this paper I estimate the inflation risk premium (IRP) using a low- dimensional arbitrage free dynamic model through novel strategy. Instead of modeling nominal and real yields jointly, make assumptions about short-term rate. More specifically, assume it follows Gaussian process. This framework has closed-form expression for IRP. Since are not observed, to parameters approximate them by brea...

The representative agent model (RA) has dominated macroeconomics for the last thirty years. This model does a reasonably good job of explaining the co-movements of consumption, investment, GDP and employment during normal times. But it cannot easily explain movements in asset prices. Two facts are hard to understand 1) The return to equity is highly volatile and 2) The premium for holding equit...

The equity premium puzzle shows that using standard parameters and setup, the Consumption-based Capital Asset Pricing Model’s (CCAPM’s) prediction of the premium associated with systematic risk is out by an order of magnitude. The object of this paper is to consider the implications of each of the broad classes of explanations of the equity premium puzzle for resource allocation, welfare and po...

agricultural insurance is one of the most important mechanisms to providing security for investment in agricultural and natural damage reduction. one of the modern types of insurance is weather index- based insurance that developed based on climatic parameters such as rainfall and temperature. the purpose of this study is to identifying the factors affecting wheat farmer's participation on...

Insurance companies typically divide premiums into earned and unearned premiums. Unearned premium is the portion of that allocated for remaining period a policy or still needs to be earned. The risk arises when an insufficient cover future losses. Reserves are called deficiency reserves (PDRs). PDR received less attention from actuarial community compared other such as reported but not fully se...