Koren, Miklós (contributor); Tenreyro, Silvana (contributor) - 2005
.3
Our model departs from the portfolio view of the world that features a necessary
trade-off between volatility and … product
more expensive in the world market. This terms of trade improvement partly offsets
the original shock. On the other … problem is
exp(−ρt)C−θt = λξt, (13)
for all t and state of the world, that is, marginal utility is proportional to the state …