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Optimal consumption for infinite number of periods and exogenous income
I have the following optimization problem:
$\max_{\{c_t, s_{t+1}\}} \Pi_{t=0}^\infty c_t^{\beta^t}$
$\text{subject to } \space c_t + s_{t+1} = y_t + (1 + r) s_t \text{ and } s_0 = 0$
How do I find ...
- 167
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Natural borrowing/debt limit and other borrowing constraints
When confronted with the simple household consumption maximization problem under uncertainty (and with Arrow security sequential trading)
$$\max_{\{c_t(s^t),a_{t+1}(s^t,s_{t+1})\}_{t=0}^{\infty}}\...
- 121