Cerletti, Enzo A.; Pijoan-Mas, Josep - Centro de Estudios Monetarios y Financieros (CEMFI) - 2012
In this paper we study the transmission of income shocks into nondurable consumption in the presence of durable goods. We use a standard a life-cycle model with two goods to characterize the interaction of durability of goods, durability of shocks, and borrowing constraints as determinants of...
