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Empirical Tests of the Consumption‐Oriented CAPM

Publication ,  Journal Article
BREEDEN, DT; GIBBONS, MR; LITZENBERGER, RH
Published in: The Journal of Finance
January 1, 1989

The empirical implications of the consumption‐oriented capital asset pricing model (CCAPM) are examined, and its performance is compared with a model based on the market portfolio. The CCAPM is estimated after adjusting for measurement problems associated with reported consumption data. The CCAPM is tested using betas based on both consumption and the portfolio having the maximum correlation with consumption. As predicted by the CCAPM, the market price of risk is significantly positive, and the estimate of the real interest rate is close to zero. The performances of the traditional CAPM and the CCAPM are about the same. 1989 The American Finance Association

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Published In

The Journal of Finance

DOI

EISSN

1540-6261

ISSN

0022-1082

Publication Date

January 1, 1989

Volume

44

Issue

2

Start / End Page

231 / 262

Related Subject Headings

  • Finance
  • 3801 Applied economics
  • 3502 Banking, finance and investment
  • 1502 Banking, Finance and Investment
 

Citation

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BREEDEN, D. T., GIBBONS, M. R., & LITZENBERGER, R. H. (1989). Empirical Tests of the Consumption‐Oriented CAPM. The Journal of Finance, 44(2), 231–262. https://doi.org/10.1111/j.1540-6261.1989.tb05056.x
BREEDEN, D. T., M. R. GIBBONS, and R. H. LITZENBERGER. “Empirical Tests of the Consumption‐Oriented CAPM.” The Journal of Finance 44, no. 2 (January 1, 1989): 231–62. https://doi.org/10.1111/j.1540-6261.1989.tb05056.x.
BREEDEN DT, GIBBONS MR, LITZENBERGER RH. Empirical Tests of the Consumption‐Oriented CAPM. The Journal of Finance. 1989 Jan 1;44(2):231–62.
BREEDEN, D. T., et al. “Empirical Tests of the Consumption‐Oriented CAPM.” The Journal of Finance, vol. 44, no. 2, Jan. 1989, pp. 231–62. Scopus, doi:10.1111/j.1540-6261.1989.tb05056.x.
BREEDEN DT, GIBBONS MR, LITZENBERGER RH. Empirical Tests of the Consumption‐Oriented CAPM. The Journal of Finance. 1989 Jan 1;44(2):231–262.
Journal cover image

Published In

The Journal of Finance

DOI

EISSN

1540-6261

ISSN

0022-1082

Publication Date

January 1, 1989

Volume

44

Issue

2

Start / End Page

231 / 262

Related Subject Headings

  • Finance
  • 3801 Applied economics
  • 3502 Banking, finance and investment
  • 1502 Banking, Finance and Investment