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One Way to Think About Interest Groups Is in Terms

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Essay

One way to think about interest groups is in terms of the type of interest they represent. E. E. Schattschneider identifies which two types.


Definitions:

Market Risk Premium

The extra return expected by investors for taking on the risk of investing in the stock market over a risk-free rate.

Security Market Line

A line representing the relationship between the expected return of a market security and its risk, as measured by beta.

Systematic Risk

The collective risk for all investments in a market or a specific part of the market that cannot be offset through diversification.

Unsystematic Risk

The danger linked to a certain company or sector that can be reduced by spreading investments across a varied portfolio.

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