Theoretical foundation of buffer stock saving

Description

"'Buffer-stock' versions of the dynamic stochastic optimizing model of saving are now standard in the consumption literature. This paper builds theoretical foundations for rigorous understanding of the main characteristics of buffer stock models, including the existence of a target level of wealth and the proposition that aggregate consumption growth equals aggregate income growth in a small open economy populated by buffer stock consumers"--National Bureau of Economic Research web site.

Subjects

Series Statement

• NBER working paper series ;
• working paper 10867
• Working paper series (National Bureau of Economic Research : Online) ;
• working paper no. 10867.

Links

• URL
• http://papers.nber.org/papers/W10867