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

C-Tier
Journal: Economics Letters
Year: 2014
Volume: 122
Issue: 2
Pages: 303-307

Score contribution per author:

0.335 = (α=2.01 / 3 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

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.

Technical Details

RePEc Handle
repec:eee:ecolet:v:122:y:2014:i:2:p:303-307
Journal Field
General
Author Count
3
Added to Database
2026-01-24