RDP 9812: An Optimising Model for Monetary Policy Analysis: Can Habit Formation Help? Equation (2)

Z t = ρ z Z t1 +( 1 ρ z ) C t1 MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaGaamOwamaaBa aaleaacaWG0baabeaakiabg2da9iabeg8aYnaaBaaaleaacaWG6baa beaakiaadQfadaWgaaWcbaGaamiDaiabgkHiTiaaigdaaeqaaOGaey 4kaSYaaeWaaeaacaaIXaGaeyOeI0IaeqyWdi3aaSbaaSqaaiaadQha aeqaaaGccaGLOaGaayzkaaGaam4qamaaBaaaleaacaWG0bGaeyOeI0 IaaGymaaqabaaaaa@4A52@