Pareto weights as wedges in two-country models
License
Access Rights
Cadmus Permanent Link
Full-text via DOI
ISBN
ISSN
0165-1889
Issue Date
Type of Publication
LC Subject Heading
Other Topic(s)
EUI Research Cluster(s)
Initial version
Published version
Succeeding version
Preceding version
Published version part
Earlier different version
Initial format
Citation
Journal of economic dynamics and control, 2016, Vol. 72, pp. 98–110
Cite
BACKUS, David, COLEMAN, Chase, FERRIERE, Axelle, LYON, Spencer, Pareto weights as wedges in two-country models, Journal of economic dynamics and control, 2016, Vol. 72, pp. 98–110 - https://hdl.handle.net/1814/44985
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.