PT - JOURNAL ARTICLE AU - Ravi Kashyap TI - Solving the Equity Risk Premium Puzzle and Inching Toward a Theory of Everything AID - 10.3905/jpe.2018.21.2.045 DP - 2018 Feb 28 TA - The Journal of Private Equity PG - 45--63 VI - 21 IP - 2 4099 - https://pm-research.com/content/21/2/45.short 4100 - https://pm-research.com/content/21/2/45.full AB - The crux of the equity premium puzzle is that the return on equities has far exceeded the average return on short-term, risk-free debt and cannot be explained by conventional representative-agent, consumption-based equilibrium models. The author reviews several attempts undertaken over the years to explain this anomaly and explores whether a fusion of the approaches supplemented with better methods to handle various reservations would provide a more realistic and yet tractable framework to tackle the various conundrums in the social sciences. The rationale for a unified theory is that beauty can emerge from chaos and many long-standing puzzles seem to have been resolved using different techniques.TOPICS: Private equity, analysis of individual factors/risk premia, performance measurement, risk management