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dc.contributor.authorMatsen, Egilnb_NO
dc.date.accessioned2014-12-19T14:32:03Z
dc.date.available2014-12-19T14:32:03Z
dc.date.created2006-10-10nb_NO
dc.date.issued2002nb_NO
dc.identifier126144nb_NO
dc.identifier.urihttp://hdl.handle.net/11250/267205
dc.description.abstractWe introduce habit formation in a model that studies the link between international trade in financial assets, economic growth, and welfare. As with time separable preferences asset trade increases the mean growth rate, but it also increases growth-volatility. We demonstrate that the welfare gain from asset trade is lower with habit persistence in consumption. This reflects that the habit-forming households perceive the higher growth-volatility as a higher cost to obtain increased average growth. Calibrating the model to data for North America and Western Europe, we find that habit persistence lowers welfare gains of financial integration by about 40-50 %.nb_NO
dc.languageengnb_NO
dc.publisherInstitutt for samfunnsøkonominb_NO
dc.relation.ispartofseriesWorking Paper Series, 1503-299X; 2002:1nb_NO
dc.titleHabit Persistence and Welfare Gains from International Asset Tradenb_NO
dc.typeResearch reportnb_NO
dc.contributor.departmentNorges teknisk-naturvitenskapelige universitet, Fakultet for samfunnsvitenskap og teknologiledelse, Institutt for samfunnsøkonominb_NO


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