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Robert Shiller (1980): "Do Stock Prices Move Too Much to be Justified by Subsequent Changes in Dividends?" (https://www.nber.org/papers/w0456.pdf https://www.nb
by em500 7y ago
Robert Shiller (1980): "Do Stock Prices Move Too Much to be Justified by Subsequent Changes in Dividends?"
(https://www.nber.org/papers/w0456.pdf https://www.nber.org/papers/w0456.pdf)
Answer: yes they do, ergo stock prices are affected by much more than just estimates of futures cash flows.
- adrianN 7y agoThat's a great reference. Thanks.
- em500 7y agoThe article was later published as American Economic Review 71(3): 421-436, one of the absolute top journals in economics, and selected as one of its top-20 papers in the past centuries[1], and one of the works that won Shiller his Nobel Prize in 2013[2]. [1] https://www.aeaweb.org/articles?id=10.1257/aer.101.1.1 https://www.aeaweb.org/articles?id=10.1257/aer.101.1.1 [2] https://www.nobelprize.org/prizes/economic-sciences/2013/shiller/facts/ https://www.nobelprize.org/prizes/economic-sciences/2013/shi...