Public Stock Ownership

14 Pages Posted: 25 Feb 2018

See all articles by Giacomo Corneo

Giacomo Corneo

Free University of Berlin (FUB) - Department of Business and Economics

Date Written: March 2018


The government of a country with a good financial reputation could borrow from the international capital market and use the proceeds to endow a sovereign wealth fund that mainly invests in the world stock market. In expectation, this country would gain the equity risk premium multiplied by the size of the fund. This gain could be earmarked to a social dividend. This paper deals with the conditions under which such a policy is welfare‐improving, discusses the optimal size of such a fund, and proposes an institutional framework for the management of public stock ownership.

Keywords: Public ownership, sovereign wealth funds, social dividend, redistribution

JEL Classification: H0, H5

Suggested Citation

Corneo, Giacomo, Public Stock Ownership (March 2018). Annals of Public and Cooperative Economics, Vol. 89, Issue 1, pp. 11-24, 2018, Available at SSRN: or

Giacomo Corneo (Contact Author)

Free University of Berlin (FUB) - Department of Business and Economics ( email )

Boltzmannstrasse 20
D-14195 Berlin, 14195

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