The Australia Institute made a Submission to Review of the rate of return guidelines. As an appendix we have attached a paper, The equity premium in Australia, that should be read in conjunction with this submission. This paper was prepared for the 2017 Conference of the Society of Heterodox Economists at the University of New South Wales.

This submission will mainly concentrate on the use of two premia; the inflation premium and the ‘equity premium’ as it is generally called in the economics literature.