Long-run risk through consumption smoothing
Web5 de jul. de 2012 · We examine how long-run consumption risk arises endogenously in a standard production economy model where the representative agent has Epstein--Zin preferences. We show that even when technology growth is i.i.d., optimal consumption smoothing induces long-run risk--highly persistent variation in expected consumption … Websmooth consumption during unemployment spells. Private unemployment insurance could provide the same function, but, due to prob-lems such as adverse selection, private con-sumption insurance markets for spells of unemployment may not exist.' Individuals can save for unemployment, but this is less effi-cient than pooling unemployment risk through
Long-run risk through consumption smoothing
Did you know?
WebDownloadable (with restrictions)! We examine how long-run consumption risk arises endogenously in a standard production economy model where the representative agent … WebLong-Run Risk through Consumption Smoothing Georg Kaltenbrunner and Lars Lochstoery;z First draft: May 2006 June 18, 2007 Abstract We show that a standard …
Web“ideal” fiscal policy that combines the benefits from long-run fiscal discipline with the benefits from government consumption smoothing in an incomplete markets … Web15 de fev. de 2024 · In the summer of 2024, one of the world’s largest production lines for battery chemicals was inaugurated in the industrial site. The mine has a capacity of 18 million tons of ore per year. There is intense activity on our visit to the mine. On a ledge, six Epiroc rigs are drilling 15–17-meter-deep holes for the week’s blast.
Web27 de fev. de 2007 · Abstract. We examine how long-run consumption risk arises endogenously in a standard production economy model where the representative agent …
Web12 de abr. de 2024 · Many countries have adopted carbon regulatory policies in pursuit of carbon neutrality, which pose great transition risks for energy-intensive sectors. Using the panel data of 186 Chinese listed enterprises in the energy-intensive sector from 2007 to 2024, this study investigates the impact of green technology innovation on corporate …
WebEven when technology growth is i.i.d., optimal consumption smoothing induces highly persistent time-variation in expected consumption growth (long-run risk). This in-creases the price of risk when investors prefer early resolution of uncertainty, and the model can then account for the low volatility of consumption growth and the high price of risk with … switch to weapon swords and sauceWeb30 de jun. de 2024 · We introduce Epstein-Zin (1989, 1991) preferences into a real-business-cycle (RBC) model with government. We calibrate the model economy to Bulgarian data for the period after the currency board regime (1999-2024). We evaluate the quantitative importance of the presence of ”early resolution of uncertainty” motive for the … switch to vzwWebof investors for a smooth consumption path as implied by the intertemporal budget constraint; and (ii) the large equity risk premium that agents demand when they fear a reduction in long-run economic prospects. Keywords: Recursive preferences, intertemporal budget constraint, expected returns, asset pric-ing, long-run risks. switch to voxiWeb3 de dez. de 2007 · We examine how long-run consumption risk arises endogenously in a standard production economy model where the representative agent has Epstein--Zin … switch to vodafone ukWeb106 long-run productivity risk. The model and main asset pricing results are presented in section 107 3. Section 4 examines the sensitivity of the results to (i) the elasticity of substitution between 108 consumption and leisure; (ii) different specifications of long-run risk; (iii) the decision horizon of 4 switch to vonageWebjusti–cation for the previously proposed long-run risk dynamics of aggregate consumption growth based on a standard production economy setup. We conclude that simple consump-tion smoothing in an economy with i.i.d. technology growth naturally induces long-run consumption risks. Long-run consumption risks are therefore not some esoteric … switch to weatherWeb1 de mar. de 2024 · We provide evidence that consumption growth is highly predictable over long horizons – our measure explains between 23% and 38% of cumulative future … switch to wayland