realizations is front loaded, a closed form aggregate consumption function with CRRA preferences is derived. To have a closed form … life-time wealth and then the optimal consumption path. The derived model captures precautionary saving, which is dependent ….S. consumption data. …

In this paper we examine the link between wage inequality and consumption inequality using a life cycle model that … incorporates household consumption and family labour supply decisions. We derive analytical expressions based on approximations for … the dynamics of consumption, hours, and earnings of two earners in the presence of correlated wage shocks, non …