Growth and financial liberalization under capital collateral constraints: The striking case of the stochastic AK model with CARA preferences - Aix-Marseille Université
Article Dans Une Revue Economics Letters Année : 2014

Growth and financial liberalization under capital collateral constraints: The striking case of the stochastic AK model with CARA preferences

Résumé

We consider a small-open, collateral-constrained AK economy. We show that the combination of CARA preferences and uncertainty on capital inflows generates long-term growth while the deterministic counterpart does not: long-term growth is entirely driven by precautionary savings, and the asymptotic growth rate of the expected capital stock is increasing in both the risk magnitude and the Arrow–Pratt absolute risk aversion parameters.

Dates et versions

hal-01463906 , version 1 (09-02-2017)

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Citer

Raouf Boucekkine, Giorgio Fabbri, Patrick A. Pintus. Growth and financial liberalization under capital collateral constraints: The striking case of the stochastic AK model with CARA preferences. Economics Letters, 2014, 122 (2), pp.303--307. ⟨10.1016/j.econlet.2013.12.009⟩. ⟨hal-01463906⟩
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