|Bauer, Christian (15. March 2009): The Reservation Wage under CARA and Limited Borrowing. Discussion Papers in Economics 2009-8|
A continuous-time sequential job search model with savings and CARA preferences is solved analytically without resorting to unlimited borrowing and real-valued consumption. I isolate the effects of limited borrowing and nonnegative consumption as well as risk-aversion on the reservation wage by using a system of ordinary differential equations.
|Item Type:||Paper (Discussion Paper)|
|Keywords:||labor income risk, wealth-dependent reservation wage, borrowing limit|
Economics > Munich Discussion Papers in Economics
Economics > Munich Discussion Papers in Economics > Macro-Economics
Economics > Munich Discussion Papers in Economics > Labor
Economics > Munich Discussion Papers in Economics > Mathematical Methods
|Subjects:||300 Social sciences > 300 Social sciences, sociology and anthropology|
300 Social sciences > 330 Economics
|JEL Classification:||C61, E21, D91, J64|
|Deposited On:||05. May 2009 13:09|
|Last Modified:||11. Feb 2015 21:44|
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