Optimal consumptionβportfolio choices an
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Zvi Bodie; JΓ©rΓ΄me B. Detemple; Susanne Otruba; Stephan Walter
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Article
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2004
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Elsevier Science
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English
β 414 KB
We examine consumption and investment decisions in a life-cycle model with habit formation, stochastic opportunity set, stochastic wages and labor supply exibility. Retirement is taken into account by specifying an age at which labor earnings stop, but consumption spending continues. Explicit soluti