A closed-form solution for the continuous-time consumption model with endogenous labor income
نویسنده
چکیده
In this paper we study the consumption, labor supply, and portfolio decisions of an infinitely-lived individual who receives a riskless wage rate and income from investment into a risky asset. Uncertainty about wage income arises endogenously, because labor supply evolves randomly over time in response to changes in financial wealth. We derive closed-form solutions for the optimal policies, and derive the Euler equation for this problem.
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تاریخ انتشار 2009