Equity Risk Premiums (ERP): Determinants, Estimation and Implications - The 2023 Edition

ArXiv ID: ssrn-4398884 “View on arXiv”

Authors: Unknown

Abstract

No abstract found

Keywords: N/A, Insufficient Data, No Abstract

Complexity vs Empirical Score

• Math Complexity: 6.5/10
• Empirical Rigor: 7.0/10
• Quadrant: Holy Grail
• Why: The paper employs sophisticated financial models (DCF, option pricing, risk decomposition) requiring advanced math, and its empirical component is data-heavy, featuring historical time-series analysis, implied premium calculations from market prices, and country-specific risk scores, making it backtest-ready despite lacking explicit code or GitHub links.

  flowchart TD
    A["Research Goal: Determine & Estimate Equity Risk Premiums for 2023"] --> B{"Data Inputs: Historical Market & Government Bond Returns"}
    B --> C["Methodology: Cross-Sectional & Time-Series Analysis"]
    C --> D["Computation: Discounted Cash Flow & Risk Models"]
    D --> E["Outcome 1: Estimated Equity Risk Premium for 2023"]
    D --> F["Outcome 2: Key Determinants of ERP Identified"]
    D --> G["Outcome 3: Implications for Investors & Valuation"]