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Pareto weights as wedges in two-country models

David Backus, Chase Coleman, Axelle Ferriere () and Spencer Lyon

Journal of Economic Dynamics and Control, 2016, vol. 72, issue C, 98-110

Abstract: In models with recursive preferences, endogenous variation in Pareto weights would be interpreted as wedges from the perspective of a frictionless model with additive preferences. We describe the behavior of the relative Pareto weight in a two-country world and explore its interaction with consumption and the real exchange rate.

Keywords: Recursive preferences; Consumption and risk-sharing; Real exchange rate (search for similar items in EconPapers)
JEL-codes: F31 F41 (search for similar items in EconPapers)
Date: 2016
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Working Paper: Pareto weights as wedges in two-country models (2016) Downloads
Working Paper: Pareto Weights as Wedges in Two-Country Models (2015) Downloads
Working Paper: Pareto weights as wedges in two-country models (2015) Downloads
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