Search Results - subject:"Utility function"

Dimensional Analysis of Production and Utility Functions in Economics

Kim, Bryce - 2015

This paper explores dimensional analysis of production and utility functions in economics. As raised by Barnett, dimensional analysis is important in consistency checks of economics functions. However, unlike Barnett's dismissal of CES and Cobb-Douglas production functions, we will demonstrate...

Persistent link: https://www.econbiz.de/10013030882

An Economical Business-Cycle Model

Michaillat, Pascal - 2015

and supply lead to fluctuations in slack but not in inflation. Our model extends the money-in-the-utility-function model … by introducing matching frictions and including real wealth in the utility function. Matching frictions allow us to … represent slack and to consider a general equilibrium with constant inflation. Wealth in the utility function enriches the …

Persistent link: https://www.econbiz.de/10013031362

Precautionary Saving with Selden/Kreps-Porteus Preferences Revisited

Li, Jingyuan - 2015

This paper re-examines precautionary saving with general Selden/Kreps-Porteus preferences. The conditions existing in the literature are much more complex than in the Expected Utility framework. We obtain a simple and intuitive result on precautionary savings via disentangling time preference...

Persistent link: https://www.econbiz.de/10013033341

Note on the Stock-Wise Utility Function Used in Their Option-Value Analysis

Börsch-Supan, Axel - 2015

utility minus the utility when retiring now. This note shows that a utility function which depends only weakly on the value of … leisure such as the utility function proposed by Stock and Wise (1990) and used in many applications (see Gruber and Wise …, various issues) makes this difference flat relative to a more leisure-sensitive utility function. This explains the poor …

Persistent link: https://www.econbiz.de/10013014991

The Kydland-Prescott Trick to Make Business Cycle 'Real' : Reducing DSGE to a Utility Function

Choi, Hak - 2015

are eliminated this way, the so-called DSGE model is reduced to a utility function …

Persistent link: https://www.econbiz.de/10013020917

Incomplete Stochastic Equilibria with Exponential Utilities : Close to Pareto Optimality

Kardaras, Constantinos - 2015

We study existence and uniqueness of continuous-time stochastic Radner equilibria in an incomplete markets model. An assumption of "smallness'' type - imposed through the new notion of "closeness to Pareto optimality'' - is shown to be sufficient for existence and uniqueness. Central role in our...

Persistent link: https://www.econbiz.de/10013022029

Another Avenue for Anatomy of Income Comparisons : Evidence from Hypothetical Choice Experiments

Yamada, Katsunori - 2015

We propose a new avenue for studying income comparisons effects, namely hypothetical discrete choice experiments in which respondents are presented with alternative combinations of hypothetical monthly income amounts, both for themselves and certain reference persons. With this experimental...

Persistent link: https://www.econbiz.de/10013038539

Long-Term-Care Utility and Late-in-Life Saving

Ameriks, John - 2015

Older wealthholders spend down assets much more slowly than predicted by classic life-cycle models. This paper introduces health-dependent utility into a model in which preferences for bequests, expenditures when in need of long-term care (LTC), and ordinary consumption combine with health and...

Persistent link: https://www.econbiz.de/10012457693

Climate Sensitivity Uncertainty : When is Good News Bad?

Freeman, Mark C. - 2015

Climate change is real and dangerous. Exactly how bad it will get, however, is uncertain. Uncertainty is particularly relevant for estimates of one of the key parameters: equilibrium climate sensitivity--how eventual temperatures will react as atmospheric carbon dioxide concentrations double....

Persistent link: https://www.econbiz.de/10012457766

From One-Fund Separation to One-Derivative Separation — The Stochastic-Solution Portfolio Choice Model under Risk

Yuan, Yiyong - 2015

Assuming appropriate infinite-state model, we consider a previously un-examined stochastic-solution choice problem which includes known constant-solution choice problem as a degenerated case. We suggest dependence conditions on risks to range or explicitly solve for the stochastic solution with...

Persistent link: https://www.econbiz.de/10013012469