Welfare Cost of Model Uncertainty in a Small Open Economy
This paper extends the canonical small open-economy real-business-cycle model, when considering model uncertainty. Domestic households have multiplier preferences, which leads them to take robust decisions in response to possible model misspecification for the economy’s aggregate productivity. Using...
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| Format: | Article |
| Language: | English |
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MDPI AG
2020-10-01
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| Series: | Entropy |
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| Online Access: | https://www.mdpi.com/1099-4300/22/11/1221 |