Long-Term Discount Rates Do Not Vary Across Firms

Keloharju is with Aalto University School of Business, CEPR, and IFN. Linnainmaa is with the University of Southern California and NBER. Nyberg is with the Aalto University School of Business. We thank Jonathan Berk, John Cochrane, Mathias Kronlund, Jon Lewellen, Yan Liu (discussant), Anders Loflund, Owen Lamont, and conference and seminar participants at Florida International University, Lund University, Tinbergen Institute at Amsterdam, University of Illinois at Chicago, University of Illinois at Urbana-Champaign, University of Miami, University of Michigan, LA Finance Day, and Society of Financial Studies 2018 Cavalcade for insightful comments and Jonathan Berk, Timothy Johnson, and Lu Zhang for providing the code for the models simulated in Section 2 and Section 5. Linnainmaa and Nyberg are also affiliated with Citadel and Linnainmaa with Research Affiliates. Neither Citadel nor Research Affiliates provided any funding for this research. Financial support from the Academy of Finland and Nasdaq Nordic Foundation is gratefully acknowledged. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.