Chen (Journal of Money, Credit and Banking [2007] 25-48) studies the AK model where the utility function includes multiplicative habits in consumption and argues that the model has multiple balanced growth paths with different growth rates. However, one of his calculations is incorrect. I show...

da Costa and Werning (2005) prove that the Friedman rule of setting nominal interest rate to zero is locally optimal in a monetary model where each consumer receives a privately observed skill shock and the government uses incentive compatible non-linear income taxation. In this paper, we show...

da Costa and Werning (2005) prove that the Friedman rule of setting nominal interest rate to zero is locally optimal in a monetary model where each consumer receives a privately observed skill shock and the government uses incentive compatible non-linear income taxation. In this paper, we show...

Chen (Journal of Money, Credit and Banking [2007] 25-48) studies the AK model where the utility function includes multiplicative habits in consumption and argues that the model has multiple balanced growth paths with different growth rates. However, one of his calculations is incorrect. I show...

Kobayashi, Nakajima, and Inaba (2007) show that in the neoclassical business cycle models with collateral constraints, a boom can be generated in response to an optimistic change in expectations on the future state of the economy. They call this business cycle a news-driven cycle. In their...

Kobayashi, Nakajima, and Inaba (2007) show that in the neoclassical business cycle models with collateral constraints, a boom can be generated in response to an optimistic change in expectations on the future state of the economy. They call this business cycle a news-driven cycle. In their...