Liu, Zheng; Waggoner, Daniel F.; Zha, Tao - Federal Reserve Bank of San Francisco - 2009
investment, Bt+1 is a nominal state-contingent
bond that represents a claim to one dollar in a particular event in period t + 1 …, markets for bond, com-
posite labor, capital stock, and composite goods all clear. Bond market clearing implies
that Bt = 0 …; (iii) markets clear for bond, composite labor,
capital stock, and final goods.
IV. Equilibrium Dynamics
IV.1. Stationary …