Human capital-based four-factor asset pricing model: An empirical study from Pakistan.

This study aims to extend the Fama-French three-factor model by including human capital as a fourth factor. For this purpose, we have collected data from 164 non-financial firms from July 2010 to June 2020. To evaluate the validity and applicability of our augmented human capital-based four-factor model, we apply the two-pass time series regression proposed by Fama-Macbeth (1973).