| Article ID | Journal | Published Year | Pages | File Type |
|---|---|---|---|---|
| 5055434 | Economic Modelling | 2011 | 14 Pages |
Abstract
⺠We study a three-period model with quadratic utility and a borrowing constraint. ⺠We decompose the effects of heterogeneity and uncertainty on equilibrium interest rates. ⺠For patient agents, heterogeneity alone explains half the decrease in interest rates. ⺠Decreased borrowing, as opposed to precautionary saving, explains half the decrease in interest.
Keywords
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Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
James Feigenbaum,