Paper #659

Títol:

Incomplete markets, labor supply and capital accumulation

Autors:

Albert Marcet, Francesc Obiols-Homs i Philippe Weil

Data:

Octubre 2002

Resum:

In this paper we explore the accumulation of capital in the presence of limited insurance against idiosyncratic shocks, borrowing constraints and endogenous labor supply. As in the exogenous labor supply case (e.g. Aiyagari 1994, Huggett 1997), we find that steady states are characterized with an interest rate smaller than the rate of time preference. However,wealsofind that when labor supply is endogenous the presence of uncertainty and a borrowing limit are not enough to give rise to “aggregate precautionary savings”.

Paraules clau:

Idiosyncratic Shocks, Incomplete Insurance, Labor Supply

Codis JEL:

D52, D58, J22

Àrea de Recerca:

Macroeconomia i Economia Internacional

Publicat a:

Journal of Monetary Economics, forthcoming

Descarregar el paper en format PDF