Asset Management, Human Capital, and the Market for Risky Assets

Isaac Ehrlich (), William A. Hamlen and Yong Yin ()

Journal of Human Capital, 2008, vol. 2, issue 3, 217-262

Abstract: Conventional finance models treat risky-asset prices as "fully (information) revealing." Less work exists on how prices become information revealing. Our answer focuses on the micro foundations of information acquisition and the role of human capital in "asset management." We derive testable propositions on how education and the opportunity cost of asset management affect risky-asset demand, portfolio returns, asset-price volatility, and equity premiums. Using micro-level data, we find that education raises the portfolio share of risky assets and overall portfolio returns, whereas wage rates exert opposite effects. We find that the rate of return to education in generating nonwage income is nontrivial.

Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10) Track citations by RSS feed

Downloads: (external link)
http://dx.doi.org/10.1086/593051 (text/html)
Access to the online full text or PDF requires a subscription.

Related works:
Working Paper: Asset Management, Human Capital, and the Market for Risky Assets (2008)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ucp:jhucap:v:2:i:3:y:2008:p:217-262

DOI: 10.1086/593051

Access Statistics for this article

More articles in Journal of Human Capital from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().