RDP 9812: An Optimising Model for Monetary Policy Analysis: Can Habit Formation Help?
Equation (A12)
1
C
t
(
C
t
Z
t
γ
)
(
1
−
σ
)
−
γ
(
1
−
σ
)
(
1
−
ρ
)
P
t
=
β
E
t
[
(
1
+
r
t
+
1
)
1
C
t
+
1
(
C
t
+
1
Z
t
+
1
γ
)
(
1
−
σ
)
]
−
β
γ
(
1
−
σ
)
(
1
−
ρ
z
)
E
t
(
(
1
+
r
t
+
1
)
P
t
+
1
)
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