Editing Economic puzzle (section)

{{short description|Mismatch between economic theory and observation}}
{{Refimprove|date=April 2025}}

In [[economics]], a '''puzzle'''<ref>{{cite web |title=Solving the country’s economic puzzle |url=https://research.manchester.ac.uk/en/clippings/solving-the-countrys-economic-puzzle |website=research.manchester.ac.uk |access-date=8 April 2025 |language=en}}</ref><ref>{{cite web |title=On The Up: Is self-belief the missing piece of the economic puzzle? |url=https://www.nzherald.co.nz/business/economy/crisis-of-confidence-is-self-belief-the-missing-piece-of-the-economic-puzzle/FQKTXHSTXBCCXGG7X6CASQRTQQ/ |website=nzherald.co.nz |access-date=8 April 2025 |language=en-NZ |date=8 April 2025}}</ref> is a situation where the implication of theory is inconsistent with observed economic data.

An example is the [[equity premium puzzle]], which relates to the fact that over the last two hundred years, the [[risk premium]] of [[stock]]s over [[Bond (finance)|bonds]] has been around 5.5%, much larger than expected from theory. The equity premium puzzle was first documented by Mehra and Prescot (1985).