These two decisions are characterized by final-age version of the static labor supply Euler equation
(24) and the static intended bequests Euler equation
Acting upon this belief, the representative household will consume less and invest more today, hence two opposing effects on the household's intertemporal Euler equation
The economy is being held back not by exogenous "headwinds" but instead, since interest rates in the past (initially, in the second half of the 1990s) were too low and too much spending was brought forward from the future, is being held back by the endogenous working of the Euler equation
for consumption, which says that consumption will be on a downward path, relative to income, if the relevant interest rate is below the rate of time preference (and, heuristically, there is reason to believe that this is the case).
However, it gives us an important intertemporal optimality condition for consumption known as the Euler equation
After imposing equilibrium conditions, the log-linear form of the Euler equation
This is problematic, because GDP consists of consumption and investment, and what comes down most during an economic disaster is investment, not consumption (which enters the Euler equation
and thus matters for pricing.
29) is referred to as the Euler equation
for the intertemporal maximization under uncertainty.
The domestically financed FDI's Euler Equation
33 is rewritten as follows:
Using the Bayesian econometric techniques detailed in An and Schorfheide (2007), I estimate a subset of the deep parameters of the DSGE model that features four behavioral equations: an Euler equation
, a generalized Phillips curve, a monetary policy and a equation that governs the dynamics of relative prices.
Equation (1) represents the hydraulic power of the turbine, this equation comes from Euler equation
adapted for the double-flux turbine.
Notice that standard errors are easily found from this by estimating the Euler equation
parameters with an instrumental variables estimator.
t,v] give the consumption Euler equation
for real bonds, the consumption Euler equation
for stocks, and individual supply of hours, respectively: