Krebs, Tom; Kuhn, Moritz; Wright, Mark L. J. - Federal Reserve Bank of Chicago - 2014
macroeconomic model with human capital risk, age-dependent returns to human capital investment, and endogenous borrowing constraints … due to the limited pledgeability of human capital (limited contract enforcement). We show analytically that, consistent … capital risk. A calibrated version of the model can quantitatively account for the life-cycle variation of life …