The one-sector growth model with idiosyncratic shocks

This paper investigates the one-sector growth model where agents experience idiosyncratic endowment shocks and face a borrowing constraint. It is shown that a steady-state capital level lies strictly above the steady state in the model without shocks. In addition, the capital stock increases monotonically when it is sufficiently far below a steady state. However, near a steady state there can be interesting (nonmonotonic) economic dynamics.

MoreLess

Year of publication:	1995
Authors:	Huggett, Mark
Institutions:	Federal Reserve Bank of Minneapolis
Subject:	Economic development

More details

Extent:	application/pdf
Series:	Discussion Paper / Institute for Empirical Macroeconomics.
Type of publication:	Book / Working Paper
Notes:	Number 105
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005498987